AME - Earnings call transcript Q1 2024

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

Operator

Good day, and thank you for standing by. Welcome to AMETEK's First Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Kevin Coleman, Vice President of Investor Relations and Treasurer. Please go ahead.

Kevin Coleman

Thank you, Julia. you Conference us Call. thank Quarter AMETEK's and Earnings XXXX morning, for for joining First Good and We Chief Dalip President Executive are Officer; Financial today Dave and Puri, Zapico, Executive Chairman and Chief Officer. Vice

which uncertainties today's from of expectations. differ on will forward-looking change course the cause are factors actual call, to and During subject risk significantly may be we making statements, that various to based results

and amortization filings $XX.X A our is found costs uncertainties integration the of detailed between acquisition. Investors risks that results any AMETEK's acquisition-related section XXXX the the our any share GAAP forward-looking disclaims excluding to contained of measures diluted affect AMETEK per made statements. in our and obligation website. adjusted Any XXXX after-tax to Medical million be and guidance $X.XX to results in update excluding the with or in quarter pretax call charge revise adjusted may SEC. Reconciliations press the the or release Paragon future basis, intangible on be or will references first an discussion intention or this related XXXX on for and or on can

the with and prepared begin We'll call today's questions. then call we'll remarks, open for

I'll now turn the meeting over to Dave.

David Zapico

and performance to double-digit leading delivered Kevin, strong earnings of operating outstanding share. results good AMETEK you, morning, everyone. quarter growth Thank with in the XXXX first per in

the from continued and of the a the sales, our we for and of our model, operating results margin resiliency success contributions and is all and strength for first quality and to are we year, testament half Considering for established and AMETEK colleagues. back positive robust quarter, flows. our expansion increasing guidance records outlook the businesses outstanding the During cash full the growth core the of income deliver the our excellent EBITDA, quarter year. earnings AMETEK's

$X.XX were Acquisitions X quarter small a Book-to-bill quarter X% and with very the the results. the operating the $X.XX income the billion quarter, in currency AMETEK's XXXX. Organic increase slightly. a over our performance quarter was of quarter basis record points a foreign same in over first of XX.X% were record and from Sales at excellent. XXXX. Now period Operating backlog in year quarter start the added the $XXX turn XX% first points to quarter ended XX impact. near the levels. the we down prior of in X.XX, was was first billion, let positive me had up a were the strong sales margins million, Operating up in year.

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

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

First, quarter Aerospace our acquisitions year. in added the sales X and remained X% margins had $X.XX across strongest record businesses. to for in & Organic Analysis EIG points. quarter, impressive leading margin Electronic to Sales last Growth the were with Instruments were a operating performance year The Group the X% up start the Group. and the operating Materials Instruments Electronic expansion. tremendous Defense up quarter of strong billion first from and

margin our basis of Operating the $XXX million, up points. Paragon from record normalization EIG's a operating our the were robust inventory while operating profit operational up year, driven some Engineering. the a a speaks income quarter first $XXX first recent quality XX.X%, in by exceptional execution headwinds versus Electromechanical strong versus XX% and margins of leadership EIG expansion. XX% EMG to Medical performance positions quarter was acquisitions and of contributions year, despite XXX the solid million, businesses. The superb prior with operating This up prior Group from were margin level delivered quarter and impacting record sales operating the also businesses. highly differentiated Bison EMG's first of was

million, First income quarter the operating XX.X% operating income core while quarter. in were was margins $XXX

manage successfully and cash flow results robust headwinds Our margin deliver capabilities expansion, strong first growth model of reflect and double-digit quarter our the short-term unique growth. to outstanding market earnings

solutions strategic technology to Our businesses support on executing initiatives most our delivering customers' challenges. and our differentiated complex remain focused

market enables our acquisition distributed for provide structure cash strategy. Our sheet support robust our and operating dynamics, flexibility to ample in flow while balance responding

optical organic reflected accelerate development our expect The this was and and committed This remain recently in John excellence. million operational a to continuous metrology high-growth global attractive achievements expanding initiatives annual exemplifies of design of support and highlight our of leader engineering with XX% in an invest secular incremental of best our aerospace exceptional moment ultraprecise in initiatives of a components XXXX, development continuously our customers' new which of advanced across within In us an our together our Dr. and work is invest RD&E systems growth Award, growth med Zygo, to our to energy, index sizable the take for along commitment deliver to support efforts. an results. of manufacturer to continued AMETEK's effectiveness help in we quarter. AMETEK's innovate businesses applications the and AMETEK long-term acquisition Lux sales strong steady portion strategy research, markets AMETEK these These include well capitalize to new H. AMETEK is and electrification award business $XXX tech, on defense AMETEK's and elements model wanted investments positioned and a the product growth example areas. We portfolio the the was in to provided and the efforts. first expand these critical markets. optical marketing ensure that improvement stream growth with and position success. I and in awarded vitality ensures presence that commitment investing a products to clean diverse and how to is a to

strategy, led advance teams its technology segment, output, commercial part an this and teams them like As a and strong augmented Utilizing Sigma, the Zygo advanced increase market achieved mapping, to attractive they a closely value increase and cross-functional identified deploying the optical new this and in meaningfully as allowing Lean commercialize of the solution. production. a of application. capabilities of reality demand market need Zygo expansion solution development opportunity stream growing together demand precise for This as product meet tools in virtual highly success their for growth new metrology metrology The to work compelling their systems. and to working Zygo's applications support resulted requirements threefold to for and to Six remarkable production the

operational important for done. our growth. global to and accelerate identify, exceptional achievement expansion new to the market and Zygo a development, Congratulations product strategies excellence highlights develop help need address team job This between the solutions well market an and to synergy deliver technology

in XXXX Now acquisition acquisitions we integrating are AMETEK. our switching to The completed into nicely strategy.

growth, to and accelerate capabilities leveraging improvements We integration help infrastructure global our their our proven operational strong and drive are returns. deliver

space in as the our market acquisition. Medical the tech attractive these growth excited very are about We expanding markets, including med they presence Paragon through acquisitions are

and we capabilities which outstanding of engineered innovation and components design December, and a serving leading number and instruments. of is acquired Paragon market highly a an Medical, segments. consumable manufacturer position a in Paragon brand, medical high-growth leading surgical single-use has strong

on focused will drive improvements. allow first while better excellence charge and and Paragon improvements us are efforts supporting AMETEK's infrastructure integration took in we accelerated this growth, and to efficiency drive quarter also profitability. and for position leveraging integration Our growth capabilities accelerating operational the to these The

are robust, actively our ahead, opportunities. on working acquisition pipeline Looking multiple remains we and

financial balance to continued the capital acquisitions prudent deploy meaningful shareholders We through acquisitions. deployment. on We capital have strategic strategic look and delivering to capacity and our to forward value sheet

for to Now the the of turning our remainder year. outlook

year last first to the improvements the as call. half impact of on through the earnings of the expect normalization half of year We indicated we in inventory our the with continue second

As we $X.XX the $X.XX. previous low the Diluted year are $X.XX, up double in last earnings of mid-single-digit the full with to per now percentage X% to from growth. to to digits year's on share for X% a a expect basis up to be to expected to sales sales compared range continue of low organic overall the to $X.XX year, increase result, for be an guidance results, range

up For X% overall earnings to anticipate $X.XX, prior the year. sales mid- $X.XX X% the versus to single quarter, second to up to with we digits of be high

exceptional operating strong growth, a delivered which our earnings exceeded expectations, by quarter summary, In with driven AMETEK first performance.

the by encouraged benefit remain results to confident current and and our XXXX. the are of in from sales ability improved growth We environment back in these half navigate

in has confident of future the are our AMETEK adaptability drive talent and success stakeholders. the road long-term to will model We sustainable continue AMETEK the our of for world-class

will turn quarter. we'll of the to who Dalip over of now cover questions. take Then Puri to details some will glad the I financial it be your Dalip?

Dalip Puri

Dave, good you, and morning, Thank everyone.

and first exceptional strong flow level strong conversion. free record highlighted, highlighted and core a sales margin expansion had Dave AMETEK operating with quarter performance, As very cash by

Now the additional first provide for me some highlights quarter. financial let

first with of First million expenses year's or general and X.X% administrative quarter. quarter line were $XX.X sales, in last

be to X.X% XXXX, For sales. and approximately expenses expected of are fiscal general year administrative

First debt up $XX and down due million year Paragon first compared million, were Other XXXX. to due of income XX.X% tax following quarter higher expense $XX acquisition million December expenses first of the income balances prior quarter the the quarter outstanding down in to operating interest The interest XXXX effective year's was to from quarter. the XX.X%, was $X rate higher prior primarily pension higher from first Medical.

continue XX% to to effective our be we XXXX, anticipate between tax and rate For XX%.

$XX or rates either Depreciation we be or and of million, intangible share. quarter stated amortization expect amortization full-year Capital dramatically, of expect amortization and to $XXX expenditures $XX have first about X% million the we expenditures year this tax were depreciation to for approximately sales. estimated In quarter can after-tax full per XXXX, $XXX actual the quarterly diluted we in from differ acquisition-related and $XXX approximately million, the the capital in expense million was $X.XX or negatively including million. approximately to rate. in As continue be past, positively

flow flow quarter versus XX.X% X% first the up Operating prior was of was XXXX, X% million, year. while in free capital $XXX the first cash of $XXX quarter working over sales. the was Operating million, up cash

For a of was the income. net quarter, flow free cash conversion strong XXX%

expect For billion, XXXX. from down XXXX, free $X.X debt the flow XXX% we in the at of end income. continue and was at net range billion XXX% cash remainder $X.X of Total strong of to XX of conversion March the

At million. end first quarter, was $XXX Offsetting this our and X.Xx, of of the it's and debt-to-EBITDA debt, debt-to-EBITDA cash ratio ratio cash equivalents net our gross the X.Xx. was

initiatives We credit and cash have $X.X of available excellent support with our active growth capacity financial acquisition to facilities flexibility pipeline. our continue and to approximately billion and

plus While provide our also and and acquisitions performance, opportunistically cash XX% flow. in our increases. In #X to excellent we leading of the core quarterly of robust free our to February, shareholders And with share, outstanding with per strong a dividend start margin increasing results delivered priority our for our $X.XX expansion cash use seek operating year dividend. repurchase XX% summary, in cash to our businesses flow, consistently announced shares consecutive increase year free fifth we annual to our remain a

Kevin?

Kevin Coleman

questions? please we can open the Julie, Dalip. for lines you, Thank

Operator

Our Instructions] comes Deane from Dray line question RBC. [Operator of of the first

Deane Dray

be start we're of of It kind maybe tour just the the and geographies finish the kinds just with out, usual destocking end of markets and seeing we of drawn off comments. and -- it to all in the Can kind continues with up pockets.

not way. on kind AMETEK that refresh specific well? But your it's any in of what's just as So feel

David Zapico

all, sure. sizable the the activity energy Growth businesses businesses, I'll and with our Sure, there and and Deane. benefit within we're company, our Process and were positioned our around expectations. semiconductor with walk roughly really to sales year our versus start and the with for last that solid remains across do project in Glad start to well business. Process these Overall markets. flat investment from I'll line

to businesses For year, single Process up digits. the expect we our low full continue to for sales be

businesses. with & XXXX, of I'll the and organic both quarter. A&D to was high similar for start all we Growth to strong sales defense and A&D a segments percentage to commercial digits growth expect businesses year single switch our the up organic our Next, across both XX% commercial, solid for our Aerospace be to basis very and and a had in continue on growth businesses, our aerospace with aerospace defense approximately across Defense,

Power. Next, I'll move to

sales. acquisitions And contributions of power UEI segment, being acquisition percentage recent XX% up Our including were A&ES our digits organic from and continue the offset attractive Power energy quarter the from we in Research expected Power the Solutions a grid the offset XXXX. And basis decrease were to and of a single-digit number quarter low the mid-single-digit presence contributions investment Paragon mid-XXs being Bison -- in by first high sales cycle, with a on businesses for and Amplifier to acquisitions with single-digit organic Automation the benefit decrease with to expanded low market Engineering sales overall by RTDS the the segments, low highly of acquisitions for quarter growth which a organic along up in in These in of double Engineered expansion the Medical were sales. the segment, going strong infrastructure. for in from renewable & expect of finally, market within are to XXXX, a up

with continue see be to As return consistent half had digits result, last we continued expected, expect of half indicated of growth and the as impact low first then businesses in we to second to year. we up stronger a what quarter. And back year quarter, the the base customer single our levels growth expect the inventory the our for finally, sales organic we in across of from the OEM a in automation to normalization

on company. asked in what's various the you also I for around think geographies. going walk the the that's So And

So that our our down and against and too, difficult was U.S. to a strongest comparison, businesses. aerospace growth X% was get Deane. The in pretty defense

in in with up businesses. in digits process and were Process X%, we our of of Europe, growth strength minus single we And parts to Moving weakness were automation. so down by organic X% parts Power our businesses notable our with low Asia, across offset

in good had saw businesses. our little process further, we China performance the our we So flat a that Asia. a in And digging growth was of in very down into quarter, the parts

and was So China Asia flat. up low single in digits

Deane Dray

help. It's all Go really ahead.

David Zapico

Yes.

You asked last talked we had playing think quarter. I about out the destock, Yes, about it's that as Deane.

will of to the think the but that half quarter, continue we I second into in around. the second year, the turn destock expect

watching a thought. positive in QX, just thought the we're and was may to So bit more closely positive. we kind year than because we second mean, the really of playing be was out in for destock it think that that probably we I it's be half going as later of the is but year

Deane Dray

investments. component, of your Great. on unique And typically, wrinkles growth know there kind could is of this capital? Is a just you any a terms follow-up that you're deploying but is I playbook. other it's the how mean, quick share? anything salespeople, here We in

David Zapico

have have after in the with and largest of projects, the of Yes. longer it It's slate development engineering, is we're we And salespeople engineering. we chunk research, getting and them. excellent full a term opportunities

our in product what's positive development very on happening So new I'm programs.

Operator

the of Vertical Jeffrey Sprague comes Our from Research Partners. next of question line

Jeffrey Sprague

absorbed of didn't of address the Paragon bit maybe asset? this how And trying the deal of kind charge itself, a what took out, prior the you are more Can bed break just as you kind smaller quarter deals, of to this large but but and charge recall a you it's that a I little performing in kind down accomplish? onetime nature you're ones there is that don't this like you just on

David Zapico

acquisition the when we we you we quarters. And take we size that's something see, I like wanted of opportunities opportunities tremendous as it's the the we acquisition. believe, bigger bought, absorb proceed Zygo, of we smaller charge the last typically because and And is Jeff. because time are integration the to Yes, of improve mean kind that did this, to great because that of question, I a and the a there And the what years through acquisitions tremendous, said. business.

largest you about Paragon done. We acquisition billion. So know, it's deals as larger It's a onetime was we have that for $X.X nature. spent

we thought. with we comfortable than we So dug as we with honestly, more management it, opportunities team, Quite plan. there's work into got this our really as

good after both and We a really that of have Paragon are getting now. it leaders team AMETEK

good really around integration this positive largely being going it's a years, integrated about feel the well, it. the over restructuring happen than couple on payback I is business. The we very of is X-year think future. And and So AMETEK the I into to really as see next less

deal. So doing, and excellent payback. the feel And and that, we positive started we're we're about positive of really what on I

Jeffrey Sprague

then gears, was revenue. switching the color organic performance was of And the little on on sorry for growth in the segment other segments, at just elements it, And late, color bit but can you missed I'm decompose and on level? Great. quarter what or price if just I'm any maybe we revenue if have a the some curious... I I

David Zapico

you look our go The overall the was the organic And EMG XX% at sales growth down plus was at That's in EMG overall plus sales were X. X%. point. X%. if groups. Yes, organic organic X.X were -- EIG up were just were overall about sales and EIG modestly, minus growth because sales X. plus both

So group you for had defines that revenue. dynamics the

Jeffrey Sprague

question. X X just maybe kind to this of destock last And back

confidence in of other have QX Maybe destock do. what level and kind Just the hard know are to better your actually side? it's going to like being that it if customers address comment and sell-through on it know in kind than was I you of expected, But visibility that you that, is, more just to just fact, your could? on

David Zapico

yes. Yes,

this and year, year, have and XX% half revenue half, at you profits and point half, of first second what first exactly year. in the we we of revenue our AMETEK's that's is of typically of XX% in profits have the look and second the The first half when the our

back-end is half second the not loaded. year our of So

good feel that. we So about

see that orders really point you our Another have may stabilized. not appears it

Specifically, the to quarter, quarter then 'XX. when 'XX 'XX, compared to look at next look I last QX I QX the QX and 'XX QX at

So backlog the the removed. last X quarters all acquired sequentially, with

So 'XX. in QX really seen growth looking a both rate orders at true in low single-digit QX sequentially. We've 'XX and run

like we've good time, bottomed 'XX, and an same to feels it some At we starting So the see in quarter. QX extremely had we're improvements. modest

destocking to comp us difficult book-to-bill. positive commentary had to communicate return phase a finally, and we second battling. And a have should will that importantly, the perhaps come we of customer So we've we're that and to year continues half the most to in an end, that

averages. economic of a year, watching terms of -- the the the growth, we're but environment, And second easier sales kind in XX% the we're half So expect the get modest closely, just year. grow at not any we'll very recessionary environment. for each that not the to economic is and time, this I And we same aligned our much in not quarter it balance acceleration historical modestly said, XX%, HX assuming and with as economic comparables HX of split, we're the of

Jeffrey Sprague

and you And on a floor. missed the I'm sorry, did see price? I'll it, have comment I

David Zapico

good and question, to do spread to portfolio bit, in And niche the a a Jeff. was these between more a continued was inflation of than them. for approximately we to come speak positive the around AMETEK X% to bit come in pricing and but maintain year, quarter to the markets position offset The we full expect a inflation product globe. expect their in the Pricing in and highly the leadership our differentiated Pricing That's nature inflation. results was about X%.

Operator

Our comes the of of Brett line from Mizuho. next Linzey question

Unknown Analyst

This Brett Linzey. is [indiscernible] for

nimble regions ability look supply we about your flex as then needed? you aggressive and is So your more different tariff can if just configuration talk around regime, chain how to a more potentially at

David Zapico

million became And And chain. had supply we $X tariffs back were great look in us give $X.XX, Yes, issue tariffs, whole happened XXXX to what or at aggressively for you completely price. frame. from to cost there And company, a across going minimal we our million. done. mean quarter, an a idea and rebalanced impact bigger about that only It's in we've a and it's time is tariffs offset the question. $X the largely are a the they I

and and overexposed to from from the not a Mexico from the we're Europe. of of the Czech sourcing globe. Asia, We in of And have we region from of we do we're And Serbia. any Malaysia. regions strategy where Republic Americas So largely do sourcing U.S., to in and sourcing a a lot other lot

around So world. we've a the nice got balance

about So work just few hard essentially past did what our small regime, with we chain. really I to China, very specifically do China increasing largely, we to a in be strategy have able there. don't of well that our that an in sales. It's it, work in think We particular, bit And deal real with tariff the of is years kind And China. supply business we a the rebalancing over we're we We're of are excellent sell risk with source continues. X% China. positioned finished very

in So pretty good a we're position of in tariffs. terms

Unknown Analyst

then cadence you tempo looking April? in And just provide and monthly Perfect. on some or into quarter the if of the color can then trends

David Zapico

typical pretty the Wait strongest a was March it the mean was I -- strongest me, excuse minute. quarter. March quarter. Yes. a was

pretty the typical March on and strongest sales. with yes, quarter, orders Okay, both being

sales highest -- were in right it's we're quarter on the in plan. March and then of April, So the

it's we're this about not it's seeing point. I good any feel the But pretty bouncing said, And -- as there. we weakness around at So guidance. incremental

Operator

Graham Our Research of next from Partners. of Scott comes line Seaport question the

Scott Graham

what mean would when the like first think Dave? maybe I'm industrial like, striking. the little we pipeline most this is does I look is seem have first Nevertheless, EBITDA last really looking that's of is could a I year mirror that though a to And near-term are wondering, year? of land just up the year kind up, at has Really, firmed a say the quarter, lot AMETEK I question EBITDAs think, M&A do environment. been this when firm about uneven. even

David Zapico

at broad it's markets. pipeline actively the Scott, across term. near a very deals number very, of the to predict But difficult high-quality set looking Yes, a we're remains very of very and strong,

facilities billion cash $X.X have Paragon. of we credit existing post and So

do support take $X balance the sheet would deals leverage we our meet -- over X.Xx. that this deals if year, would could have criteria, only about of to We our and billion that a up

an in not pipeline it finding issue. We're we're So comes now, not cash right very a extremely a and we sheet right position. issue. performing good businesses, And balance excellent have down a really It's to it's flow a the And strong M&A position. we this really pipeline. have typically with growth opportunity, with you this cash with balance our opportunity we as our sheet good strong said, the flow have differentiate element of the and performance strategy well. to the

this market bit is in So a choppy.

OpEx of M&A during I'm combination OpEx of looking this next differentiate strategy, acquisition Our with really performance our proven and M&A and to our and quarters. our the couple

Scott Graham

one quarter. sales each you of up you're organic to next for answered quarters? to be questions earlier, the saying referring modestly You X expecting Were Jeff's

David Zapico

Yes. Scott. is sequential, This

Scott Graham

Okay.

be dollar expecting you're sequentially, sales up. to So

David Zapico

be than higher higher will than be will bit QX QX QX. bit and QX a a a QX than QX, higher bit

Scott Graham

them. do Okay. that have comp orders just were against up And in orders. in I quarter dollars the one you significant sort know in stack pretty you organic? and of a the is you're on back What when last the

David Zapico

exceptional they XX. orders Yes. X were grew the 'XX, business organic were The take I comp, were again, we and went low tough single particular. minus in through sequentially had couple the you some think we the QX of out in When project of process last from orders digits -- EIG and quarters. comp, a orders and minus I orders had And of

and we take sequentially, when comfortable. on out So get what's more going you at that look you

Scott Graham

and it, 'XX periods also I No, were 'XX exceptional get for Yes. organic you.

David Zapico

Yes.

Operator

comes of Obin question the Bank from America. of Our Andrew next of line

Andrew Obin

Medical Just a question, how think the about costs. integration Paragon to

So the I what's because on this assume restructuring extra. now payback it's that's --

should guide? in how on And to embedded payback add restructuring that's of the it what's So 'XX? this 'XX much I

David Zapico

in I to at AMETEK's But we you run holds. we had Paragon going 'XX, at than $X.XX $XX and get million EPS, is the so to the still Well, told is that of going million be take to X charge, rate, less look prior that that us meetings rate, said it years, $X.XX When years Yes. to we in contribute a have there. couple benefit. of will payback run and $XX to

$XX is to So million years. less payback than get approximately spent $XX we approximately X benefits. We're going The million. of

So lot efficiently. a and we that really it business really it the great from tells too, an and just Paragon management of make team an -- perspective. exceptional sees run way, to just focus, you And excited and going has, I'm wasn't a there that can operating things we're return it's what that really

run away X XXXX, do for spent I to we said And max we benefit XXXX. out $XX that. I'm a point less in are rate. is years. you see see the going million to willing to the than and But in at I'd Regarding metrics in We'll again, Paragon million. project $XX payback not little think increase the a to we've But come substantial XXXX. too happen earnings We're to what's quantify should in related operating that much far

payback it, So shareholders. we about for feel really good good our

Andrew Obin

opportunities. probably because and probably Paragon Sorry, it make I'd extra just incremental restructuring you sure, was -- take to the but so I I'd thought offline, saw

but the guide. have So I'm not that, in you were that all saying embedded was sorry... that along -- was I should

David Zapico

lot so a us over that few just opportunities we to forward. deal, a years will take of a we and think it larger it's saw I put do -- it it

Andrew Obin

Okay. I because offline of $X.XX I'm my it Kevin, this so apologize. I thinking, in I'll happy not on extra numbers apologize. to I confirming sure had or take take should have is -- if I'm we're with it view And just offline that, it I top

David Zapico

to change have get of really doesn't this restructuring $X.XX Andrew. what don't them, $X.XX benefit your but you you I Yes. we're look from in expecting numbers, I at don't to know I Paragon and that can tell that.

Andrew Obin

And guided the in you drove just did first guess basically revenue you. give you little color bit destock Got quarter, think what you low expecting for then were double-digit and I -- below. very That on the sense. a I good makes was revenue

So destock it's it's just you said correct? pulled forward,

David Zapico

Yes.

Operator

Our line Glynn comes & of the Inc. from Co. next Christopher Oppenheimer of question

Christopher Glynn

trends energy me seeing your secular bit top you leading kind in curious curious could what and comments impact. into It electrification. was you're your with trend. go to as where the of long-term occurs I on to the transition on edge kind business of type just particular, a secular the the But evidence trends, general Power reshoring little on level of kind be and in of maybe an street Dave, see multiyear

David Zapico

Yes.

think into market, closer talked them lot about a think in going where few the Power activity are a market, long-term West. around there but I I the investments also and the drivers, on and the point renewables, we power -- to closer project for there, for the in energy but to of lot said, and my growth semiconductor semiconductors. The the a secular of -- that's for talk, project start drivers grid. business the driver as and a two you moving work little that's the we're in turning of really when finally about driver There's us

RTDS our to or business So business those. levered are really instrumentation power

that's and So to I happen Aerospace a commercial think way business. for and through. When Boeing that's again, Again, the And had & great starting a quarter the have as both continuing. its backlog good. Defense market looks we Airbus think work I about X-year

quarter the in in we're another -- defense. defense. had right We good defense position Our in

a -- it of markets and there U.S., the lot through which about I kind the but been stimulus the So I trends, system. good those to in and time future, fiscal past. takes feel not about the those of work think has And in

term, to longer right think think places in we I we're well. do the So

Operator

from of line Cowen. of Joe Giordano T.D. the comes question next Our

Unknown Analyst

for Dan is on Joe. This

orders I has a within know few Sorry, and of automation times. been destocking bottoming discussed

about been more struggling a guys But of some users. end demand reaching a of more end forward? have quick Is changing anything end with gain in have like follow-up. obviously that internal their talking you been Anything understand changed something companies also their recently? conversations out to you've users and there going few or processes This market better lot So just a is past done the have potentially to frequent to bit market visibility quarters.

David Zapico

year of I sales the anything what we go can't of follow orders. half of us, change. back We talked exactly about you to you point outpacing the if I first kind mean happened. and call to

you'd in we turn did the we before So and it a first in the that talked slightly half. that means this about destock second thought positive X have the half, would below quarter. book-to-bill. And We

get a the those communication our have there's opportunities think continuously accurate, I always we work we to it. and field is got the better system we and we're I top of on robust But improve our pretty but from feel businesses. that like with pretty and on field, information

to always -- always room and there's improve. looking to at So we're but ways improve,

Operator

of of Wolfe next the question Coe Our from Nigel comes line Research.

Nigel Coe

to just come I to David, math. the order want back

and X% organic. down XX% said you down then think I

David Zapico

Right.

Nigel Coe

X from We've got our numbers. about of contribution in Paragon points

missing, I've there just what from that in expected significant wondering So order I the numbers. am would be contribution Paragon

So math, out please. just with me help that

David Zapico

acquisition Paragon growth, the acquisition X% had the and in is We Yes. is organic. not

sales, Yes. So the -- me. excuse orders sales Paragon

Nigel Coe

makes the then orders, Paragon no X% Okay. there? organic. to, But sense, in organic that reported there Was material from downtimes impact

David Zapico

Paragon a destock had has the the is. we business -- orders backlog QX, large Paragon, EMG that through gone then timing because With QX. same look issue And Yes. there's the obviously, in the as in

So bit impacts of there. destock orders. there's That the a a

and we're digits, both we EMG the widely of piece the destocking procedures, So they're single business of high at businesses. the their kind it's they're same the growing their monitor market, It's to mid- seeing in destock information, EMG all Paragon, we medical If medical at our correcting medical growing. and inventories. the and look OEMs inventory, are the procedures, device but communicated a kind of in

of going space So year. we the half think a this first run destock the to is through

Nigel Coe

that year that forecast? do. outlook. close that to impact full I Paragon, Okay. I impact million the also... does got we've $X But sales Does destock of think

David Zapico

ahead. Go

Nigel Coe

No, Please go ahead, no. Dave.

David Zapico

Yes.

a the year, think for growth. was than first the about million. we when $XXX less Paragon, mid-single-digit And year, little we talked it the I bought

what So in we that's exactly still have our model.

now Paragon viewpoint So the that a double-digit grower years, we what and couple much is identical. and had get but of this we we into think pretty out the year of we is be it from next the will over model think it what year, of the going

Nigel Coe

some Okay. just, inventory the restructuring? on is million. And there then Is down? Or break a and that accounting sorry, $XX follow-up all

David Zapico

the was Yes. it it vast vast was small a integration and costs. But majority... part other say that the were of I'd restructuring, of majority there

Nigel Coe

into Do that well? of that come think into about we And does XQ as XQ? some

David Zapico

we done forward -- Yes. We the and benefits effort was started the we pulled all said, And I restructuring I in QX that QX. is think as in the had.

with the to charge to a another So other when And improve QX, this the did charge. positive. to But that's of that thing It's improve down similar a I if the onetime business, business we asking. It's operating very that have it. we what may is a right you're comfortable in don't with I could do. if think another we now, one-off think We acquisition. we we're you Zygo road dramatically returns ways going and charge have restructuring The what Paragon charge. capability a a to there's communicated one-off we are charge got big had

Operator

of this and I closing Kevin to it I am Vice showing turn time. further to Investor questions no now for at like Coleman, Relations Treasurer, would President back remarks.

Kevin Coleman

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

Operator

for does you conference. in program. today's Thank This participation conclude the your

disconnect. now may You

AMETEK (AME) 2 May 242024 Q1 Earnings call transcript