AME - Earnings call transcript Q4 2021

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

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Fourth Quarter 2021 AMETEK, Inc. Earnings Conference Call. [Operator Instructions] It is now my pleasure to introduce Kevin Coleman, Vice President of Investor Relations and Treasurer.

Kevin Coleman

Thank you, Andrew. Good morning and thank you for joining us for AMETEK's Fourth Quarter 2021 Earnings Conference Call. Dave Executive and Financial Vice are and Executive Officer. today Burke, Bill President me Zapico, Chief Chairman Officer; With and Chief

contained statements, excluding the of from and acquisition-related uncertainties uncertainties between During also will may XXXX Reading after-tax, risks found cause adjusted sale change in today’s obligation and in of disclaims that update AMETEK's will with or results to of Bill that and and may affect forward-looking and detailed amortization AMETEK on in or and begin for remarks our over and gain quarter XXXX. Dave can XXXX taken in charge the to the the which our basis, differ the quarter made the call discussion results forward-looking any the on any by turn significantly based factors revise excluding is today the to Alloys intangible A first the Reconciliations open with Dave. an intention are first measures it of references and from adjusted GAAP We'll on risk to future now or of call, SEC. results various section our Any to on actual questions. subject then filings expectations. course make statements. up website. be meeting we Investors of prepared the release be I'll this press XXXX realignment

Dave Zapico

performance and remains to end broad-based robust and backlog leading AMETEK XXXX. our superb Thank outstanding Stronger-than-expected with we enter growth an record in you, XXXX markets, order excellent profit concluded operating quarter. everyone. Demand sales across strong as growth morning, growth. good fourth a and earnings and Kevin, and resulted

into a of led balance additional generation in acquisitions We to disruption our growth excellent XXXX asked and positioned uncertainty. deploy well to given pandemic six and AMETEK lot and acquisitions, sheet. flow and and tightness capital are integrating strong chain on as model the are recent our the We cash teams supply

colleagues our AMETEK hard colleagues and these challenges contributions our success. tremendous you always, your As to work results. stepped and to to Thank up tremendous all for delivered

quarter from were points nine point were foreign up orders of was were across $X.XX from the an the added over of quarter. quarter turn XX% and headwind organic of is backlog orders in quarter acquisitions. was contributions $X.XX me start Overall, XX%. plus XXXX XX% increase an orders year the period, record versus in million, which underlying XX% up record the driven quarter up ended and a to over XXXX one a prior quarter. billion, quarter the impressive operating Fourth the above Acquisitions Organic were with was quarter businesses, in income while the results. operating our a $XXX record a same by $X.XX strong, Fourth XX% We the sales fourth over billion, sales currency in the margins of the XX% billion, the XX%. let fourth and up our expectation. growth Now fourth year period

diluted performance prior in our to over the $X.XX guidance XX% led and $X.XX the points year, $XXX Excluding basis earnings up of quarter XXXX versus XX the were over $X.XX. operating acquisitions, the very and a was margins margins XXXX. operating strong of range up XX% impact share, were million, XX.X%, dilutive up of to EBITDA fourth fourth per record fourth core EBITDA the of above of quarter XX.X%. This quarter

our AMETEK ability model economic strong to strength and the in growth the record cycles. the growth performance speaks Our drive fourth to quarter of throughout

well running in impacted results recovered quickly pandemic above XXXX, and now have are the pre-pandemic we While levels.

were XXX sales the XX% points were XXXX of up AMETEK's in example, XXXX. while margins and the start XXXX pandemic, the our higher of operating fourth quarter sales basis XX% prior core than quarter of For quarter earnings to the fourth up fourth versus were

provide let operating group me the some details additional level. at Now

million First, EIG Growth compared were year's up acquisitions Instruments were a sales for quarter, XX% Electronic a sales record the billion, was one up Group, foreign and fourth last point $X.XX XX%, XX% added organic to headwind. EIG's currency remains broad-based strong same last versus the across particularly and quarter businesses. a operating EIG Gatan record with CAMECA income were margins fourth strong and quarter growth year $XXX our in up was operating XX.X%. and XX%

up Group EIG's also XX.X% excellent growth. by XX core up excellent basis million sales delivered margins the Excluding $XXX were of broad-based were the acquisitions, versus driven XXXX. quarter the sales operating from XX% quarter Fourth growth prior for outstanding sales performance. impact year points at fourth EMG dilutive of Electromechanical The organic and

up operating EMG's range XX% prior across Our to the was compared wide to the XXX saw operating a Automation in year. businesses end an margins exceptional strong basis of points fourth quarter continued demand XX.X%. markets. million, income $XXX expanded EMG's

XXXX XX% $X.XX record up prior XXXX. providing the the the with income currency, leading XXX prior XX% year growth the with the up versus and year. for share, records full diluted were Organic Now $X.X orders operating added essentially EBITDA establishing Acquisitions year in for a key XX% foreign X%, versus outstanding margins up visibility we to the for sales were increased for year. billion, from XXXX a full all XX.X% XX% $X.X was were financial margins up XX% prior ahead billion billion results. modest was per $X.X look were performance up year XXXX, And points metrics. XX%. XXXX. annual Overall for earnings up from Overall organic Operating XXXX. tailwind. solid basis core us versus orders year XX%. and backlog Overall was sales And as to year

investment support their excellent to look and of index initiative our initiatives. product our customers' long-term further We're investments growing organic to as products XXXX, solutions vehicles, businesses growth fourth also success technologies years. measure energy solutions emissions, growth assisting we the and important to in scientists in X.X% of sales. of climate name This driving new used to development, solutions, These differentiated a reduce reflects by engineering AMETEK number few In sales initiatives. through in efforts in addition the greenhouse measure introduced AMETEK supporting success level the over level development the million supporting expand invest vitality role a of is the One which monitor, In to XX%. XX% of electric markets. we our a past in supporting. development of financial of and expansion our gas technology important the important and the approximately invested XXXX. development a positioned XXXX, strong In applications very testing of attractive the product was innovation, we over just sustainability of to three we development index, continuing vitality important results outstanding research, $XXX including way from change new are our of quarter, key One the support of understanding the providing is in was for up or impacts renewable plays and and

X.X% sales spend. engineering XXXX investments We or This research, and a in XXXX. million XX% increase RD&E expect approximately in RD&E development our and is are of to $XXX invest expanding over

driving portfolio businesses. a of market-leading of capital deployment returns deploying also shareholders. industrial strategic our billion six $X and for our adding We deploying year on of in acquisitions, to are excellent the businesses capital and XXXX, record technology We our had approximately acquisition

sensor safety toxic serving compounds and applications. is environmental safety Alphasense of develops offering, annual fourth acquisition, quarter. our both used approximately Alphasense, the use oxygen, completed systems organic are technologies million. air and and and MOCON for Their sensors in gases. in sales has particulate Alphasense's U.K. and variety health applications. harmful complementary portable broaden volatile our with in including and serving critical health, and was sensors fixed $XX Essex, Alphasense and latest environmental, and highly gases, offering of projects a and quality provide detect Our and based sensor gas manufactures to are in sensor business our

acquisition active. Our remains pipeline

M&A teams work we very to XXXX. continue in Our to and expect remain diligently, busy

are pandemic. As the chain excellent chain reflect, supply our ability provide operating issues caused quickly inflation. supply to adjust including are structure the challenges leading challenges. our global the operational capabilities, businesses ongoing us agile doing our flexible, to by an These and higher to managing AMETEK's results job react

drive can the along we higher quarter long-term experienced the of were focused materials during we for offering. with short-term businesses. what continuing logistics our and third remain factories, labor we safely However, excellence able remains a We components, chain to on than this availability pricing and across issues. offset while range also inflation initiatives product and the given differentiated lead to similar to broad operating in managing our our operate times extended with environment more operational supply with our Overall, ensuring

Moving to in our chain We and challenges. XXXX. remain supply the short-term, given for ongoing outlook cautious COVID-XX

are we businesses strength uncertain manage our confident the However, our ability times. and of in through these to

to up of Diluted XX% sales versus in for approximately expect expected XXXX. high-single compared full $X.XX be overall range to year, the to we to up XXXX. the are organic with the be $X.XX, X% mid- For XX%, up to year sales share earnings digits to per

results the their like workforce fourth full In our year and all to are be the approximately first expected of of to to first for model. in year. compared to to per diluted resilience were AMETEK $X.XX the I and $X.XX the this strength the range tremendous growth year, year. sales prior employees are same For summary, and overall of to the excellent XX% reflective share XX% up last quarter be our XX% thank AMETEK's and and earnings up of quarter, past period quarter would expected versus efforts

XXXX. us Our now and strong questions. and Bill glad of and your cover the forward details, to the look to orders Year on Burke, financial it continuing backlog who the and momentum will record gained for to some Bill? I we'll be we New in over will position take to turn then XXXX, build nicely

Bill Burke

Dave. you, Thank

the an operating to results XXXX with Dave highlighted, leading AMETEK quarter. As impressive finish performance better-than-expected to outstanding had in fourth

financial some and million Let year some up year quarter $XX.X for provide Fourth for administrative the expenses were compensation as million, the largely prior full to XXXX. $X additional guidance from the general higher quarter due as expense. well additional me highlights and

largely driven $XX also and by For up year, higher administrative were the expenses general costs. compensation million, full

down expenses was XXXX provision For XXXX, the expected approximately quarter rate line be XX% the due rate This with roughly tax The was to return lower fourth in levels to fourth effective to in are tax XXXX. X.X% of and sales. administrative adjustments. XX.X% and quarter from in general

rate. be quarterly tax actual in from past, differ Working our working or our XX%. capital as And tax of excellent either the work at we XXXX, sales; stated teams quarter XX% estimated negatively, the rates this between full in and positively XX.X% to strong was in reflects For anticipate managing capital. from rate this can year effective we've dramatically, the

million the fourth intangible added lead certain million amortization sales. to per full for Depreciation amortization the million X% including are million the in expense diluted share. $XXX Capital strategically we $XXX quarter be to approximately the also supply million, the longer areas inventory expected and $XXX $X.XX for was have or about $XXX be year after-tax of or We approximately help in and Capital $XXX experiencing acquisition-related expenditures in amortization $XX times In XXXX, expect depreciation to in across XXXX full of were quarter million million. are $XX address chain. was and we the expenditures approximately year.

$X.XX balance flow continue end We times of fourth gross on XXXX efforts. ratio cash of billion equivalents full billion was times generate XXXX deployed million. year-end our cash Operating end deploy for in of level to having million to working in at levels year. the or this strong the cash year. X.X net Despite XXXX. of and model end was the from million declined of at additional cash our strength deployment, XXXX, capital X.X remain the billion given was management XXX% a and and We income sheet model. $XXX at $X.XX up approximately debt-to-EBITDA the capital our debt from only testament of $X flow $XXX positioned to debt the the of business million operating quarter the of cash for acquisitions and cash billion, $X.XX free quarter in asset-light was the full of Free Total the record strong $XXX to and given our capital Offsetting the very flow. $XXX well despite strength

and performed initiatives. approximately our very businesses a throughout well exceptionally support fourth the $X.X high challenging facilities We billion and have of in existing environment. the of cash year, credit quality quarter in our to In summary, growth a earnings delivering

our positive growth given Kevin? for model XXXX financial proven position, our workforce. outlook and our strong remains Our world-class

Kevin Coleman

you, Thank could Bill. the for open please lines we questions? Andrew,

Operator

our the And from Fargo. question Wells Poliniak comes Certainly. Allison [Operator Instructions] first line of with

Allison Poliniak

Hi. Good morning.

Dave Zapico

Allison. morning, Good

Bill Burke

Good Allison. morning,

Allison Poliniak

order It's a happening? Is might that's over numbers. like right be a extending little historical, talked sort orders more seeing on that backlog I customers, the maybe for labor you? the just because evolving of get of about Just of sort you pushed in terms I a color year Are of bit this to think than past great backlog color we've looking issues? any bit. would duration their still your any getting maybe how differently to little how

Dave Zapico

the recovered initiatives And the also if business growth mean have portfolio, think businesses economy. was on in you of it orders, the each month aerospace look Yes. had I'd rest our the out, way business, better. our strong it gas their across which we're our well, on top momentum. whole got – our the and and process hasn't highest defense well, extremely mid-cycle of incredibly which we was has organic reflects month business, out out doing automation really our and the that, at I portfolio orders very for been doing of oil call quarter recovery the one call played really doing the quarter, businesses. the quarter I December very the it's that of and also fully I But well is the board and year. and got is and And was But and the are aspect the and it

we patterns a are. one across some and backlog. giving So challenges we calls us of I because into our are what I think look is mentioned market, a And strength the healthy chain on all demand have ago very supply ended a the customers, few thing their

doesn't that So the orders that seeing strength earlier, we're we're the from feeling in but take away business.

Allison Poliniak

towards know No, that a product allocated investment nice than you more and high-level Great. focused helpful. investment And thoughts that's to specific Any others? this being there. talked few highlighted verticals capabilities. you year maybe I on then dollars you're some or then a

there? Just any color

Dave Zapico

Yes.

I the from think making it's the board. – return investments, engineering growth and we're getting and we're across our broad-based tremendous investment

This growing, put for incremental our the we'll of we're portfolio, about business. in and sustainability $XXX understand way the manage You we growth but investments million opportunities us our are them. investing year,

RD&E So see additional going investments keep we year's that's on and to going in top fundamentally, of in last to million, going. the sales incremental we're But and we're and those and are invest opportunities in marketing. momentum $XXX

Allison Poliniak

Great. I pass Thanks along. much. so will

Dave Zapico

Thanks, Allison.

Operator

from next with question Deane Dray RBC you. our Thank comes And Markets. line the Capital of

Deane Dray

Thank you. everyone. morning Good

Dave Zapico

Good morning, Deane.

Bill Burke

morning. Good

Deane Dray

maybe these everything are look, its – lots the lots supply understanding inflation, tough the to Hey, and And able it's a very giving still are work. hard of know here. impressive your deliver shortages chain labor and how issues peers of of struggling numbers you're and lot because I

you. I'll that's tends mix what hearing what might just You've something well it your not that either have we're here what your very mix about exposures has that business we're microprocessors, that have bit a biggest chokepoint but medium are given companies call dual from the to for saying, But seeing been. supply? Your and is your technology or chips them", "Look, more done

kind us of maybe help there. So

Dave Zapico

more been distributed And color our them model, a P&L chain, business corporate with units is same labor of us. challenges all Omicron point to these acts changing I their we're is team work to Yes. this these And there. and fourth teams combined committed own same the where approach with I'll everyone have has as a to the and been chain in response overall we that to logistics, lot has for the their supply together, allows give you conditions. quickly try I our extremely leverage overall first you centralized that the some and experiencing with true managers outstanding. And chain have said seamlessly AMETEK. challenges at And effective availability. everything supply business mean, the teams; forte added these business is running the we we think quarter But variant react teams, which certainly QX. time supply have

that what the of quarter, most quarter we're few in directly have I after that's challenging said semiconductor going mentioned biggest we're we I the mean, As last that's it's shortages, you one this our And but chip AMETEK. ways. and the availability, that's and leverage lot of the a using a area.

supply a over built-up period the of base. time long relationships have We with

and capability we and company. alternatives, is qualify we've also of people none, team it sources, second the engineering second redesigns find taken use a do to Our to across

Some based our of on engineering them are Bangalore office.

Some of in are Germany. them based

the shortages of quickly and that them well. that's in is available U.S., and and business are alternatives, our help Some to team for based units working quite find

don't really think it's the of availability – I So challenge. and certainly half the XXXX second I to until just we've improve anticipate the for and reasons response it that effective semiconductor a chips of earliest, at an improvements we had mentioned. But

Deane Dray

great. end there could through That's you color. that you for could? maybe just I us appreciate and if really regions, your And updates key if markets additional take

Dave Zapico

the overall strong for sales Process Organic and the low – sales contributions in acquisitions organic XX% teens and business. start the The by Process were up Alphasense. up Magnetrol the process. XX% I'll sales Sure. quarter were of with from growth high driven

ahead they to Process driven and the our CAMECA. be for into remarks, said expect Process, for have year. Analysis businesses sciences positions mid- high-end strongest businesses providing businesses as by Gatan organic I looking up semiconductor Materials The full to leading life instrumentation growth, Our digits for markets. prepared were like the high-single sales showed my And and we in

for growth. over & businesses to sales Aerospace the of acquisition mid-single-digit quarter, fourth and Now Aerospace. Overall were Defense XX% I'll sales switch Abaco by in driven up organic the

Shifting Our strong to given in benefit defense a the XXXX, while to another commercial aftermarket the due shipment driven the and positioned our quarter year. growth had and aerospace remain well set while positions by delays, the attractive strong about some business we're recovery we to cautious our diverse businesses commercial to platforms. were of commercial in from down businesses quarter led jet jet recovery, in slightly the growth, still still it patient business

expect with similar mid-single Automation Engineered across year be markets. growth and And and & digits our low Industrial the mid-single-digit with & solid were outstanding we Solutions for XXXX, all with were up Automation Automation to Power for Industrial to continued digits. similar mid-teens Engineered to defense a finally & in Power to to our Power Engineered So by Industrial segments. Automation full Overall growth delivered up up demand sales sales both high-single our Solutions. for commercial organic across from Solutions. very expect I the the in & expected be and expect and Engineered the mid-single businesses we for fourth sales Aerospace with Power & for over businesses our digits fourth our of growth and quarter organic XXXX, and & up the XX% across mid- Industrial growth Defense organic organic we up Automation & be next. driven growth our market of And for and good quarter. end overall XX% segment in sales NSI-MI. growth XXXX, in both quarter, And And quarter contributions acquisition go Solutions

Engineered Aerospace be be and the and big look to digits. will Power Process are to market digits Industrial you mid- our and & and going if Automation So up up Solutions, mid-single picture, segments at high-single

Deane Dray

That's really you. helpful. Thank

Dave Zapico

Deane. you, Thank

Operator

our of And Sprague Thank comes with from question next the Jeffrey Research. Vertical line you.

Andrew Shlosh

on Andrew It's Jeff. guys. Hi, How for you? are Shlosh

Dave Zapico

Andrew. Hi,

Andrew Shlosh

Thanks Good. question. for Good. the taking

a Firstly there? the I throughout on have price view price if cost, any do year? your mean of you view the improvement at cadence kind of on what's all, cost

Dave Zapico

or Throughout XXXX? XXXX

Andrew Shlosh

XXXX, yes. another –

Dave Zapico

Yes.

expecting total we inflation to context, for we year, in XXXX, tick inflation a in mid-Xs. we're For was inflation, – price for next the had our X.X% of had up and bit. some about business And

X.X%, X.X% the up a maybe to – excuse X.X%. me, we're our X.X% inflation expecting to X%, X% So pick bit to instead of to pricing X% to and

after is point for excess we're speak a in price But to results expecting budgeted inflation – So higher to And X% to inflation it of about X.X% in XXXX. – price we'll to see it way a of And basis differentiated in bit XX day, QX, get positive nature it's portfolio. that. spread. the see product the business. we're the for level our AMETEK's spread the we end of about and a we price highly That's off able

We niche have our leadership the globe. in around positions markets

does that answer So question? your

Andrew Shlosh

assume it's pretty margins I The business color. But great year? that's margins I to think you just other some just I only given just would expansion, I on that's one fair what had accurate? price on guiding mean, XXXX, you No, mean, Absolutely. know for said want to the full modest I for cost. say don't get the it's to you

Dave Zapico

have Yes. another we're going to I I'd think year. say margin that good –

Our, think will And and XX basis – operating margins. in be in be up range. core XX the to I think really we range. reported had XX% will and mean that that I healthy in margins in incrementals QX, point core I

incrementals XX%, out of acquisitions, think into reported we the XX%. back are Our going to that's our incrementals continue And but when you healthy incrementals, core XXXX. I core had

So structure. bullish and on things doing the that management I'm we're cost about pretty the cost improvement in

Andrew Shlosh

it Great. the on. color. for pass will I Thanks

Dave Zapico

you. Thank

Operator

And next Loop Scott Thank from our Graham comes Markets. the line Capital of you. question with

Scott Graham

Dave, Hey, Bill, good are you? morning Kevin, how

Dave Zapico

morning. Good

Scott Graham

Dave, you the by organic us a split giving for segment quarter? would of mind Hey, orders

Dave Zapico

that. Sure. can do I

XX% EMG were up company XX%, you at EIG orders QX, and orders organic for XX%. up If up the orders look our and total were were

groups growth and X.XX. the the growth company So both strong was across book-to-bill of really

Scott Graham

question. dovetail Right. my into perfect And that's actually next a

organic through growth has to caught the segment lot investments, streamlining up of our the and acquisitions a and EMG years, profile. Over just the EIG really terms in

I it split at EMG. be EIG time – of going and than segment to is work how in more wondering segments I'm acquisitions. equal Is are deals? know lot it's lot So because But larger on mean what spending equally in both that you I you're a not a looking does in

Dave Zapico

Absolutely, absolutely, it knocking there, in we'd years mean past to and that specifically segment, businesses. couple EMG an in good I put organic growth capability. out Scott. M&A acquisitions the we excellent of the made with some automation We're to our just really engineering more and park love and our good some

In fact, an to did commercial business. to we in some area But have robotic our small we're we a business, really a XXXX position, acquisition also have add like that there. – we that's and they're business, capability some good defense thermal and leadership but looking management we system hard –

of So and – terms looked hardly EMG fantastic. is very been at EMG getting past performance in has to is their going M&A,

Scott Graham

That's Thank you. great.

Just an reopenings? if one there? working? AMETEK. you the as investments you know, pretty study being you sort important The the easy How it last of It's always Are by you. how's walls markets this is research Are in. a of the four hard for outside you? How I trends going one going are squeeze could it one. – to those aided markets, in That's research is for how – your market from

Dave Zapico

business, And they're or that's highlighted other Gatan impacts nicely. research research I to of pandemic. the in saw market talk, more pick about very and for was is, the industrial parts And well. the our of important took up sales the XX% right in mainly time of my now what is that research and market and process what beginning the group And are seeing of it's right, the we extremely good, you're market life you're but the up is the picking doing research in an Now business universities XXXX of us. because sciences

not the of we're all environment say and I'd of it's from start during – environment as transitioning the a driver be a this going at funding, of the stage funding clearly pandemic are where back So of the of funding because aspects to market more at better pandemic research a growth difficult of to the to business. getting the big nature but

Scott Graham

it. you. Got Thank

Dave Zapico

Thank you, Scott.

Operator

from our Rob Wertheimer Melius Thank you. And comes of question next line Research. with the

Rob Wertheimer

Good morning, everybody.

Dave Zapico

Good morning, Rob.

Rob Wertheimer

a the I on XQ know now managed versus and to conquered what there, it how short-term, difficulties then the can question guess other is whether you've better through crested don't one you not many in So worse? than feel does now. that's going some And And better you really choppy I really, then? underlying be admirably. the the say it whether I'll indicators or or just and gets whether of Omicron, of put you there feel out on

those it little on your in Just I of for what and know runway, semiconductors. your bidding long-term and backlog in there's a and Maybe throughout automation and evident momentum year? that's like ton projects goes far bit. a visibility seems your on markets feel don't end quoting how is just out the Thank you.

Dave Zapico

a and are look we one lot the the infections first questions, variant. I you at like AMETEK. when of world, is cresting. our looks own have have internal we also peak statistics I the believe it for And Omicron mean, Rob, Great the statistics outside

to weeks, of that. bit, two we highest and prior So I think the down last infections we level the had were a

something clearly job good a of it's AMETEK it of availability of that So and through are happening when manage does managing cause cause it's changes does a pretty are but AMETEK, same doing things challenge happening inside through absenteeism day it. labor to outside But that. every and the it we're

are of solid acquisitions I market. we've very our a quickly at research that think production. benefiting of done of you fantastic there. designs for market, And how And in capable if of you customers. control, So job. is did business That because technology capability people that subassemblies past growth broader long-term business I going now a issue our talked the in about little mentioned continuing. I winning custom are We unique and we're And semiconductors, And in you we're really seeing the going the to we're our is We're that new market And But about – together, and that's that's and our doing When automation, little parts – that. And side into the acquire that's a develop but of in of we're talk And put guide the that well. range the two in look the and got then continue. research motion think we're market. automation and when a bit automation dealing clearly competing semiconductors. it's you QX, we've from to QX. kind ramp CAMECA pieces of that. work the chip with part and very lot semiconductor runway some

And some Zygo expert EUV and in in that. an an technology that the expert world a people business the called are new optics, couple and something of uses in of is there's only that our

from the semiconductor that to transition is getting trend and benefiting the optics just started. industry, EUV we're So, in

I'm not really we're downs automation ups there's saying be some going forward. we well as look So, but positioned in we and both and forward, semiconductors to as go

Rob Wertheimer

for teaching there. you. the Thanks Appreciate Thank it.

Dave Zapico

you. Thank

Operator

Thank you. And Berenberg. your the Buscaglia next question of with line Andrew comes from

Andrew Buscaglia

morning, Good guys.

Dave Zapico

Andrew. Hello

Andrew Buscaglia

things, and, but broadly maybe – indirect a for I'm yes, impact around context talk risk like seems it China, not direct shortages, there's regionally? increased given you risk component risk And cetera. looking bit et some specifically, a Can number little of there, supply maybe chain more from just some

Dave Zapico

Sure. that. talk to Yes. I'll

QX. whole our Automation the strength we notable a broad-based give I'll up our mid-XXs. at all we up is a were point first mid-teens in growth In first strong, U.S., businesses. across geographies. in Europe, look In was The and were geographical business It

in Process had bounced there strength businesses. there, And Automation also. nicely were X% Process our both notable and notable in we and back and we up in Asia, we So, strength and Automation

So broad-based all cylinders. firing on

parts handled is The world. differently in is reaction the that of one. point Your good COVID a

So, we we've strong been have, being very countries start in shut certain at down access comparison, a we were or asked through semiconductor you up China, to pandemic. we solid at of year. and had plants you the times, the had in really strong because and blocking can really are about managing particular, that X% and China, But a

a quarter. it in in been us, for and strength put China strong notable strong strong all process So notable year then strength is has in and Zygo,

businesses our growth China of where in see niche we outlook, continuing. we're in the markets solid as types our competing So pipeline for of

Andrew Buscaglia

commercial sense And exiting it aerospace, year. like the helpful. might quarter I the have like your one this of this demand maybe half the that's really building what years. every that for kind asked reopening of of is question year? strong, and more other I Is last growth in Yes, for strong was two see that same? But with past one back the a Okay. the of with kind

Dave Zapico

going the we're year. digits. going market that be a sure. year the to upwards. might we be happen good still business in it But not for also. for have ready low Yes, And we're pandemic's in I and we're businesses world. double we're to of inflect We're different this year We're think And might They different up of aftermarket driven and some on digits being for by our the the cautious in in mid-single impact up seeing to parts of think strength but quarter because the yet. were sure. impacts travel second XXXX It commercial half

Andrew Buscaglia

typically indicator Is for a you to that guys that that pick when – starts up? for aftermarket leading

Dave Zapico

I business mean deciding and shutdown seeing And aftermarket recovering, we're aftermarket. indicator, function a of a leading travel good people through see the and hard two things. think a is the and jets industry to it's are differently. now I you went

Andrew Buscaglia

Yes.

Dave Zapico

of And seeing good strong position in and both those demand.

Andrew Buscaglia

you. Okay. Thank

Dave Zapico

you. Thank

Operator

next with Coe Nigel question the comes Research. Thank line our And of Wolfe from you.

Unidentified Analyst

This everybody. is on for morning, good Nigel. Hey Brian

Dave Zapico

Hey Brian.

Unidentified Analyst

any or color investment, specific just within kind maybe So growth new the $XXX just of engineering, going, million. R&D on the that's where initiatives like more Any products? and

Dave Zapico

R&D, with on platforms. incremental not our million sales into first. Yes. $XX it's across and any We're of a money We're and putting million they I'll increased on wide platform, range putting growth side, forth business about marketing. And start increased spend one the put and we're investments. dependent R&D into our to $XX the want about where leaders

quickly, that of lot we're expanding already in and out that and opportunities work spread business. digitization, us our customers the pandemic, and in investments to marketing, return e-commerce a on it's providing very area. on those our amongst the sell sales off because across capability And So, and they're for different our we're good are pay now will through of terms we doing on

Unidentified Analyst

some kind chain a just you supply it talking there of better. just of like because expect And else outside for are cost first anything the kind think also far the thinking navigating as to about the peers note, of is you're bridge do hold about when price then feels half, that. of XXXX, investment, this the kind of two halves the to into seasonality normal then of your on about growth margin? a And and kind tale margins Great. of dynamics as be I similar but Thanks at depressed in

might you same not Thanks. So, that dynamic. see

Dave Zapico

Yes.

increases strong sequentially our in I of AMETEK think which seeing we're quarter, each is but an budget typical budget, with QX. and growth

about your to just economics, and is if million. taken. to So, that look about be When margin And budget, increase. based apply on you our XX% simple we've point XX%, XX% $XXX on that's up guided at a contribution I

guidance that's number that gave you. range a of get You'll the the in we

XX% there's there's the Now in But that higher number, all acquisitions margin a is cost there million, a there a That's a $XXX pretty last things, headwinds bake XX% shares, picture. type put are of that year, we're below-the-line together, bit to to when little you it going cost. with investments, get lot savings, you did some interest about taxes, on. up new contribution are Sales and it's and XX%. cake simple we

clear So, from it's pretty that perspective.

Unidentified Analyst

Got it. Thanks.

Dave Zapico

Yes, thank you.

Operator

with next And of the Giordano line question comes you. from Thank our Cowen. Joe

Joe Giordano

good guys. Hey, morning,

Dave Zapico

Joe. morning, Good

Joe Giordano

less have like are a order on the has on or a as what's this view your I been questions year already But of ask I to one you know so, been this if asked book-to-bill Apologies I that the and obviously, it busy answered. progresses? morning. susceptible And Yes. It's strong bit really been side, mean, how any at But patterns of kind advance customer thinking what kind are here? set the early point? you order in your about could – it are ordering seeing? some like others. there you like far or kind that Is a up how inventory than like of so vacuum ordering Like customers at like like of

Dave Zapico

customized Yes. products. I mean we have

Joe Giordano

Yes.

Dave Zapico

our to giving us to problem about don't issues I in the of aware time, things not But are like on chain talked investing supply going So, increased orders us a the customers that at and visibility we're run or think future. out into being – that. to the we've same and go distributor placing people

organically over. got EIG backlog. that it and at So, right across that and spread up, in both strong. may in our We our up the before And some But EMG. orders was on EIG you mentioned roll XX%, seeing similar were organic now, we're strong the point, remarks prior in were orders it looks very businesses.

else? into So, think – we it have supports changed I month January Anything the our was But are of rates the not guide. January. strong, and order

Joe Giordano

for Okay like interesting. the have dilution Maybe, give again, you answered might did core in ex XQ? you this, M&A but incremental and EIG

Dave Zapico

Yes. talk and reported core XXXX. was We the – it about the XX% did it company, was for whole

had... So, we really had good And a core. performance you

Bill Burke

It was EIG. up XX margins basis ex in points acquisitions

Dave Zapico

points It yes. was acquisitions… Yes, XX ex up basis

Joe Giordano

Is that…

Dave Zapico

[Indiscernible] it business or two up two was sixty was so thirty, good.

EMG EIGs acquisitions the EMG, across So, but incrementals for are and the some incrementals were And good there look EIG XX%. the core the company. the XX% EIG, XX% the core depress were margins at for at whole that The were you company. incrementals board look you were

acquisitions, incremental lower core incrementals reported for strong margins little So, a across EIG company. because of the were the really but bit the

Joe Giordano

Very good. Thanks guys.

Dave Zapico

you. Thank Yes.

Operator

And Thank Mason next Baird. question the from comes of line Rob our with you.

Rob Mason

Yes, good Thanks for morning guys. taking the question.

Dave Zapico

Rob. Good morning,

Rob Mason

– this curious point. topic some XXXX? But to in bridge contribute did what's could earnings component I'm the And acquisitions in to EPS? of just what I XXXX acquisitions. at around terms the in the maybe stick the math acquisition just Just what probably on in do the

Dave Zapico

XX% the for believe the few EPS of budgets was And about I But minutes that was $X.XX I believe XXXX. the that in the XXXX. a for economics bridge it for talked it just I ago. in about same is included

Rob Mason

Dave, mean, for I a noted was it And you… very year sure. Sure, you busy

Dave Zapico

Kevin just me, I $X.XX. told Rob, It's actually said $X.XX.

in $X.XX happened in and XXXX. So, its it $X.XX XXXX to be

for So $X.XX it's of both them.

Rob Mason

Okay, understand.

just You bit on your And Has all a the to or in Has faster that little the busy helped chain had, you the a acquisition challenges around curious, supply terms integrate ability it supply very you hurt with year you move chain. front. forced I'm front? on to of mentioned, integration-wise as that?

Dave Zapico

Yes.

I culture think AMETEK and us it's processes AMETEK the installed faster forced the to and move getting installed. getting

And So, into And with but very faster we're and of environment the AMETEK distributed operating obvious, well. niche company. each the a integrate on usually integration are our they markets. and strong take the the acquisition they're with of presence is fit in fantastic they and bunch mean they slower, the markets. differences it's in leaders take made deals us working our the attractive like in we businesses. have teams, can Each be the ownership, all. able them we models, nicely are early going and of And expanding are are They perfectly differentiated go technology that and to integrating benefits our and it strategy. positions I

myself, presidents very been the time of spending well. the are them. Bill and lot group going have And So, on and a acquisitions

Rob Mason

there. a over – order shift that on would frame just recently. ever, that, time last should what nine-digit that yes. And say, an a think. I that something to like And your business does Within largest I just Abaco one, or shift? Yes, like noticed like follow one order I one was would one, what largest what win,

Dave Zapico

there years. management It integration, years. specifically can were a And really talented, It could Abaco, the I be it's the be of mean, high-quality high and really is and team with into that team. XX%

the of AMETEK PDS it terms Aerospace In combined structure, business unit. with we've org our

So, think when of at looked this synergies. a we there's business, we lot

a AMETEK now the formed So, running we P&L with seasoned AMETEK HR leader the along person. along seasoned division one with a AMETEK have seasoned and division, and CFO we

a talent. them of some – we're there at the installed understand the they same lot Abaco help Ultera because – time, learning we've have a also lot So, AMETEK Abaco people from to

be PDS going to it's this both and for synergy think businesses, good I long is the for cost sales So, and drive run business and combination AMETEK Abaco. the over both to going

Rob Mason

Excellent. Excellent, Thank I’ll back. you. it pass

Dave Zapico

Thank you, Rob.

Operator

any showing no I further Relations Coleman, I'm will Investor President over remarks. call Treasurer, Vice Thank you. back turn questions. Kevin to for of now closing the and

Kevin Coleman

reminder, a may And the you, as our a of great for accessed joining of today. And everyone, today's Investors replay Thank Have call in be you a again, section Andrew. ametek.com. webcast day. thank

Operator

conference disconnect. now call. may you today's Thank participating, This concludes you and for

AMETEK (AME) 3 Feb 222021 Q4 Earnings call transcript