ROLL - Earnings call transcript Q2 2022 | RBC Bearings Incorporated

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Operator

Good day, ladies and gentlemen. Thank you for standing by, and welcome to the RBC Bearings Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. now host, hand IR. Michael would to conference I speaker your Cummings Instructions] like the to over [Operator with Alpha go ahead. Please

Michael Cummings

Chief Bearings Vice and the President Officer; call Officer. Good us are Director, Dr. Financial earnings you Vice thank Hartnett, today President Officer; call. fiscal Chairman, and Daniel J. RBC Bergeron, President conference on morning, Operating quarter Executive XXXX Robert and me for With and Chief Michael Sullivan, second Chief and for joining A.

RBC Before today and These you Securities recent statements under variety a in beginning greater those XXXX. me also some could impact detail the that SEC to from the or Company's discussion remind Private the results you materially operating of factors projected today's release the condition. future call, website. press a with Bearings and will of let implied risks Actual factors. of for the of differ to filings financial results Litigation are the the are that We and made Reform detailed Act forward-looking on more may in refer be described made Company's due

release information the In GAAP between and of non-GAAP available Company's is included addition, as part financial the website. reconciliation and on is

Now Hartnett. Dr. the I'll turn call over to

Michael Hartnett

$XXX.X XX%. to the were increase of Thank Net XXXX an sales Bearings. RBC and same you, second quarter welcome of period and conference good fiscal call for all, $XXX.X fiscal year, for Mike, versus morning to XXXX about million last the second quarter million the for

aerospace sales. same million, of to markets net of we of and and sales same net net million of products XX.X% of $XX.X quarter $X,XXX was year. XX.X% XX% $XX.X the million, debt. million EBITDA million, net million $X.X products to $XX.X XX% an And operating the was XX% margin million income period was XX.X% compared XX.X% increasing This and last the net of the Adjusted $XX.X strength cash quarter, period. to quarter important during $XX.X Demand $XX.X period last year Adjusted ended for with year. or the ended markets represented sales and million for end compares sales. extremely for the maintained strong new gaining sales gross last second with sales For industrial net the the as the represented of XX%. or Adjusted quarter sales of of towards from compared period industrial strength the showed performance of our

as balance a of performance was XX.X% The expansion markets excellent in the industrial continue for most orders markets aftermarket to saw of we Our served, we continued industrial sales. year to year-to-year covered expansion year. from to of extraordinary ranging demand last and We look additional strengthening Relative period. last forward up year. XX% while expand XX.X% business Dodge, over showed to over XX.X% see to OEM over these for the around a the outpace year, some showing and their year-to-date gain last OEM from of

are here their their showing good with keeping quarter. in how our a expecting and are demand. fourth performing up happy We markets on plants are Very manufacturing and

X.X%. XX% X.X% and OEM, aerospace for quarter. contracted showed the to They gain a period, for off was the markets. which Defense Turning defense by of offset the

major aircraft book fourth deliverable for quarter. halt by in components that with the to in subcontractors. now we the It inventory our complete supply orders hangover the created both as plane pickup production the order for a MAX our We all and as well seeing both about on Boeing are of and year seeing beginning in appears substantial service are abrupt and locations producers across increases of are their commercial in that Airbus our shippable later

for backlog sector is $XX fact, really over sign. up this year, last a million is great which In

expected to point or have gross we – more would would margins less a under conditions or be steady-state more have margins Our higher.

we added calendar We very commercial year. up are it's today. in to additional to to aircraft what not overhead This created costs operating, margins to see quickly. step second in we demand we absorption we In will capacity is early variance step next production support quarter, in supporting it the to demand, under had steady-state plants our however, order this degrading to But additional it do and conditions that order up an the our is see which that coming slightly. support something the

absorb to supplied adding to the the there call. order impacting staff on considerably was effective tax later rates last, And support in will previous Rob Secondly, variance owner, we've the the in ABB. Dodge services explain that acquisition been the by a

Regarding over aerospace call we between turn markets. strong a for now expecting more performance. very expect and I'll the industrial the detail somewhere financial be with to $XXX the third million from to contributions and on quarter, the both the sales are we and $XXX million, Rob quarter fourth

Robert Sullivan

of Thank of costs and you, SG&A. $XX.X jump $X.X covered of XXXX million, sales compensation due SG&A Mike. fiscal to margin, and I'll gross was The increase of was share-based $XXX,XXX for mainly compared to other to period higher items. million already additional $X year. the Since million Mike the net for last $XX million down has personnel same second quarter

for same sales, $X.X XXXX SG&A percentage year. Other for fiscal period a expense to expense year. second was XXXX the of the the quarter for net operating compared XX.X% of was compared same for expense million the second period of of last $X.X fiscal last of XX.X% As million quarter to

The million fiscal for year. Income the quarter was compared of and period quarter $X.X last of second $XX.X of XX.X% expense second income same million for income of other mainly million of tax million $XXX,XXX same XXXX for quarter an intangible On second million costs, last items The $XX.X XXXX, income the period the million $X.X quarter $X.X rate second the last compared was was year. expenses for significantly operating second intangible amortization $XXX,XXX year. in income and fiscal impacted same of to to the of of the expense with for associated Further, million costs XX.X% items for of allowance items. assets, the related Other to Operating second in $X.X stock the operating year year. amortization $X.X year tax compared for of valuation $XX.X and million period mainly to the was last last operating quarter effective other for $XX.X of adjusted and with related costs capital of XXXX of $X.X last million the million items. to of operating acquisition-related benefit comprised compared the were in the $X.X associated $X.X period discrete tax would was a restructuring of quarter other $X.X consisted second the million million this compared $XXX,XXX associated approximately $XXX,XXX and with last past For of quarter restructuring been fiscal in for as fiscal primarily expense, XXXX. compensation of basis, of rate activity Dodge, have operating blackout income million acquisition by quarter part quarter during adjusted same result the for carryforwards. loss assets, approximately

$XX.X adjusted On same stockholders XXXX to basis, of basis, for the first $X.X the compared for to million income last for the fiscal XXXX share On stockholders EPS Net quarter income the second period income XXXX adjusted compared was adjusted And for period to the adjusted million per $X.XX diluted year. to of $X.XX the $XX.X available For year. XXXX, Diluted of for per the last been income share for million would year. to $X.X available $XX.X to period for of last fiscal to adjusted an an year. $XX per period compared quarter period second same per were million company on net XXXX for second the basis, compared last earnings million common of the $XX.X per fiscal of net was to same same of second an year. income share net XXXX quarter have $X.XX for same the $X.XX diluted second last compared the million same million of was quarter quarter reported fiscal of period for net income of fiscal year. EPS last the share $XX.X for fiscal compared million common the quarter share net

been and to the year. $X.XX of adjusted the additional shares last impact compared per issued same the have would stock, Excluding EPS the share the share of diluted period for offering per $X.XX for preferred common

were million $X.X in flow. $X.X operating Turning the the of Capital company same to fiscal from million period $XX.X $XX.X for in for cash period compared cash XXXX second million to compared second in last year. year. the last generated expenditures same XXXX activities quarter quarter of the million fiscal The to

Dodge are we to things our keep as mind. ahead, into integrate there Looking a business, in few

addition as we to we of the will experience the a that with of unusual a in costs look incur time. and Dodge duplicate our amount to plants, space, period certain aerospace we In continue costs recovery integration in for toward of a

lower their than folks financials, in inflation a a environment. and associated run the most also impact bit released bit of material an detailed have previously As RBC's. historically availability margins They've this as in Dodge with had

margins RBC. we We legacy to the achieve are on track anticipated with

bit, a other lead mentioned, gradually which will these gross expect and roughly However, to improve to margins the matters, from impact we XX% to the integration, there. XX.X% consolidated margins of of impact coming period, in I incrementally

it's talk a full talk. a received with percentage about look question-and-answer to we move scale with since we Keep the XX% of when improvement a As now the share the would we I and the business, time information mind, like to in have and more spend to we with as back in turn more periods quarter next closer should as with you XX forward operator we we'll the of SG&A next. session. benefit closed, XX% information been quarter only to point Dodge. for call we to more of future the in days the expanded sharing sales as to the further improve

Operator

first Thank Alembic Skibitski coming question Global. is the Pete [Operator line Instructions] with from you. Now of

is open. line Your

Peter Skibitski

Good Hey. morning, guys.

Michael Hartnett

Good morning, Pete.

Peter Skibitski

the Excuse voice.

across problems industry Rob The defense problems same you just really that really isn't in seeing maybe inflation rest RBC having. But the correct? chain guys we've industry. the chain rest that is of seen supply Dodge. guess, Is the at on aren't much of way the I it the having of So touched supply because and

Michael Hartnett

for perfect. us to to to do here. impact by large, date. having unusual not RBC, business and Well, I on. material chain on we're any move really that say and of isn't things, situation It's have do them take the but do being successful. care And would supply We We're scrambling we

Peter Skibitski

mean, I change in here, half – Fair given been to pretty individual demand of the the has first seeing torrid, year a Okay. you're then that any And enough. Mike, just industrial from? markets industrial

Michael Hartnett

new oil it's of dormant demand last I'll much the which Well, tell market, now. dormant there's pretty and gas was Yes. XX from course, you, months. for coming the not

you a happening. And barrel, believe me, oil so $XX And happening. and get start things they're over

So really we're definitely also coming seeing coming and benefiting the we the supply over gas see on right would products a space supplied and I those lot our years now. unusual demand we've demand oil semiconductor is semiconductor. from And in of to the from really, that that's say us new constrained, standard markets.

to scrambling region. that in So customers we're whole service new

top. that think I are those the right come to the So two

Peter Skibitski

industrial? Okay. area in hard weakness find Is it to an of

Michael Hartnett

is. It Yes.

Peter Skibitski

line a included? then kind you what But includes well, to maybe, of started And of really that include – did Dodge the Rob, once the in guess to the Dodge XQ. include give I us to intangibles not we from Okay. should amortization you you other can amortization that be be sense quarter each expect line starts

Robert Sullivan

we're at Yes. question, looking allocation, a change mean, Dodge, price that $XX in including purchase what to the of $XX I amortization going the I could you through mean that's RBC somewhere some think in per Pete. bit. once of total today. million, still to quarter factor start looking a – legacy. But Obviously, million that's so great I we're we're

Peter Skibitski

it. Okay. Got

that add flow, guess. roughly We'll the Okay. I back in cash

but back Thanks add get more, I'll queue. I'll Okay. guys. in

Operator

the And our is Barger next Steve line question coming with of KeyBanc. from

Your line is open.

Robert Barger

Good Hey. morning, guys.

Michael Hartnett

Good morning, Steve.

Robert Barger

think XX% some some the to tell operational? for put Can for for into the you that to And Can think is of it I go take up. inflation, buckets of with said to back there's quarters some costs unusual margin XQ? you gross a when that availability. how versus will you integration, duplicate XX% that then us catch kind I us? we prospects much few And or Any expectations happens? said

Robert Sullivan

Yes.

guys, impact these quarter. some with constraints parts in ability weeds on to the into margin will of their a the bit And diving right. their we're they mentioned, I As higher hit availability, had more material have which next

And that's taking duplicate cost So businesses put the probably you like from on two away two right. point end. integration them or just then their a any when is together,

throw additional additional at heads You resources.

those rest And up. some So fiscal year incrementally of so. will start in through the from believers but margins will then the our do big will we're there, take as last stand the this probably It we ability grow. to to time,

Michael Hartnett

Just one comment is carve-out that, from a Steve, Dodge was that on ABB.

standalone ABB. it So wasn't within

So there's services. a shared lot of

up that be setting over up $X.X paying we service fully agreements to a new honed about have feet. to Dodge duplication as systems, we're cause their some the to on And agreements ABB million have So nine a six next still We'll using six to service systems little cost, systems. in standing the get that people, duplicate. going month bringing bit that's so of for out their months, is going to we're setting and running month, that's months two transition next a of own nine million as to were get right. the be the to trying And new new $X.X in But we're through. going transition get to

Robert Barger

Understood. that Thanks clarification. for

million $XXX million coming much to in $XXX revenue from quarter, Dodge? the for next of For is that expected how

Michael Hartnett

around The just RBC's And we center RBC. $XXX of have have range right. Dodge, range a just of their same in using is and million. quarter, for days. range They quarter like amount for to a in third – just of for Dodge point third remind, production we're have But acts – we the amount

holidays. Christmas, you the you So have have

production know always up days because So the our picked sales that's enough you from in then fourth you you days. don't us, have those just a And and worst quarter topline back. margin quarter, for production gross

right, And So our it right they're fourth going into obviously, they're fiscal makes their and – quarter much XX.X. so year-end stronger. to

X. going they're November our days right effective So calendar to be production on going forward

Robert Barger

that put I million just is that rolls is pretty from million, up line the if you about back $XXX few Right. legacy about years, within I million at in suggests with But $XXX down just XQ. a use If in will last which much sequentially XQ number, million what be look RBC that few $XX bucks XQ.

with Is a that's there of like can I feels around commentary it just bit So a the little end – how bigger sequential robust that square decline. markets?

Michael Hartnett

Yes.

year – I'd $XXX So to is for around QX, say RBC this million last the center point compared or million. for about $XXX of $XXX million

especially mainly So backlog all it's a we're coming softer QX it's in of a going activity, through QX, heavy of and in on again next little Even and getting to aerospace. to though in aerospace, going lot industrial QX start on year. be

Robert Barger

Okay.

last really XQ XX% year-over-year? easy Well, think for in aerospace So is even year. negative up a we though aerospace has comp, should expect that it's double-digits I

Michael Hartnett

because them you to just out. of in back front don't I get both I that broken me, Steve. have to have We'll don't have

Robert Sullivan

the in is see aerospace they to associated get the maiden It's parts. saw in going just that simple think probably of that with the can't We these a sales quarter be same quarter. I terms QX. lead producing that for materially reason QX going not in shift time different to

fourth them going quarter. going be they're but they're to the making to shipping So in be them,

ordered it's So ago, quarter to now. that's the what's – for months and what what's coming is six much third we've pretty planned through just nine

just And that clock proceeds. work that's way whole so the

Robert Barger

Thanks. line. back I Understood. will in get

Operator

coming is Michael [Operator with of Ciarmoli Instructions] Our question the from line next Truist.

Your open. line is

Michael Ciarmoli

down, Maybe different where your we've stay about for Is peer into significant the season the all broader that from guys aerospace, with mean Thanks you side, the pretty aerospace reporting companies of more and I Steve at the guys. guess, looking just questions revenues contrary market, something seen going. morning, to Good them. even there then this sales? just was aftermarket selling growth, the – trends here. at taking Hey. sequential there. surprising, OE we're the out from maybe distribution And runs suppliers to of seeing OE the all really flattish the which I

obviously is We widebodies anything the mean color guys you weak. it Boeing on else it you I So down. give aren't we don't to? been like on can any point know up have been saw know you are if step MAX where there you They've can I that but rate, just production. yet? guys seems seeing

Michael Hartnett

the and it book, schedules seeing in, in fourth backlog. seeing We're in seeing quarter. they're it fill and we're in filling We're the pretty order in, much the the

make made this managers of the I can statement, all hope recently plant One stuff. our we

definitely are seeing there. yes, we it So

much We make repairs. parts for are the part, from I OEMs. aftermarket mean so not most because we it do don't the aircraft for seeing we

have alive in significant much a distributors we of the parts make come they We bit to aftermarket a us and starting they're repair bearing but our it's are to shop, back And Maybe with for starting – very lagging a But just the OEMs small. of but they're business they're pretty now. little indicator, a right are picture just into now. specialists. come

And just way that's markets so the our work.

Michael Ciarmoli

Okay. as order XXX, where the presumably MAX line – going Do orders? better sight has to I mean the good signal Airbus can like and maybe? parse rates go? are skewed the seems directional XXX wide-body on flow of out mean are what towards I the where seeing it to or – there? you more mean, I have I backlog related. the is mean the a nothing you you

Michael Hartnett

new it We're we definitely bringing We're had production that XXX there. the programs the support haven't to seeing on No. It's XXX. before.

with the engaged that. LEAP happy to We're we're much engine. very So see

engine. of uses And I think, so the XX% that's LEAP XXX the –

MAX yes, and And we MAX on in pickup the then side, rates. at the see all about So Boeing, happy the see it's we're that. to

our most of depot. other sounds If it's just a XX at works, bearing I XX the start times than the part, think For in picking produce number ahead a it in an look have that weeks. mean, are the but that and example, month time. But have steel FYXXXX, anything this going lead the is XX it, way. you to a I'm way we year, really of to Boeing that as crazy. business when I planes don't using We to of year out And

to that probably the sure three get to if we to order to – And let's So so produce then really to materials, six we make the three months the say, on steel months have get it months takes bearing. the Maybe bearing of we time months to the it's less, his use into assume subcontractor. a three rule he needs but We three as months that thumb. systems. of integrate ahead it

used And to three I'm by subcontractor not make we needs the already and assume months an Boeing we've by that. than it but more Boeing, then a into Maybe So wrong to it I'm months airplane. year. wrong somewhere, three gets

Michael Ciarmoli

way one it. and helpful. that's just Maybe Got out get more I'll No, here. of the

Should through increases. think are should we to that? to margins about you Are putting think of your where on inputs, mentioned give I of about seeing Or environment? any how just able metal potential you the kind asked be suppliers on tailwind to mean, a times specifics as pricing? And What you steel. you your And pricing ordering the lead supply surcharges, more price expect you mean, can reprice? number I seen then we've that and we I Pete a chain, are? pass-through

Michael Hartnett

probably two one on the the question. hour an to side answer because side. here, on Dodge and have just one – It we RBC different the an businesses that's takes of drastically interesting Well,

the the that material distributors announced of index. PPI mid on industrial where in raw of care of those the sort And take industry RBC – there's level, we lot in contracts business have side, price a should the has of a Dodge which single-digit on the regard. a kind side, so to normally a And of and/or increase pass-through

this try how typically thing. manage that's so And we to

it going takes inflation the of used when this sure right take to there to it at vigilance that than you're – rate. make was more so no on invoicing And none

in is world the XXXX. of where November just it's So

Michael Ciarmoli

guys. it. back in jump Got queue. I’ll the Thanks,

Operator

follow-up question a Skibitski with Alembic Global. Pete have from We

Your is open. line

Peter Skibitski

guys. these kind is conduct have we've have Thanks, Yes. that of kind seen mind cost later savings the a cost Hey, line. A to on lot roll of times companies there before the when upfront down you Dodge through guys, of an in the integration?

have at still adjusted if it in wondering So And you you you results. point? work the I plan kind would is this guess process? that adjust in Or out I'm a cost just a of mind. guys a have And in do completed

Robert Sullivan

Well, that, they're we as those is – of lot transition going I tell and which think some there, continue the $X.X the significant on of By we of businesses – alluded services but vendors our the belt. tackling some end have to two those, blocking you of anything Dodge be certain but under next the Outside assistance agreement to Dan just have won't build together. cover we the million it about and a will to from outside processes, to of don't we'll – track months today. quarter, there's

to lot we'll a recurrent of tell to business in of be nine will to are costs be which the those that which a away position are six over one-time just that months. are going or period transition and So impacting go costs you better

Peter Skibitski

where guys. That's is. quarter that? start we to fair and accounting, the clarify Fair have you is And it forward convert? now about but this to talked Rob, $X Can right Are and MAX briefly previously, just in Look or price it. million the enough, you the over I about they'll you're just stock dividends expecting enough. then each on preferred

Robert Sullivan

Yes. Sure.

on based the X%. at and XXX XXX the step-up liquidation So $X.X shares of you it’s that original a about be have should securities quarter, number the track. million of XX.X% the of value The to from just dividend issued

you'll if-converted which and do dilutive assess is the calculation then on more that. So report to quarter, each

quarter, of calculating it should method expect effect the should EPS. quarter, the thing. be The is for dividend would be same This more next the I dividend dilutive. the And

Peter Skibitski

guys a up And loan? getting Okay. end you rate term did on what

Robert Sullivan

is a and specified LIBOR X.XX%. the plus X is The margin, LIBOR margin and XX. currently It's

Michael Hartnett

Yes. Exactly.

Peter Skibitski

Yes.

of flow. The Great. capital back cash working like one me. it's reverse really high Okay. of another that cash been back conversion half quarter headwind strong. working mean, exceedingly half about think the Last great the Or looks it for year. capital in I free kind year? management, kind of I half how given the in was just do of – of first free we Should mean, the the

Robert Sullivan

I in bit quarter And this investing end think and there'll get we and we're in be the WIP impact QX working in goods material QX so will early labor. weaker stronger and seeing collections a in that are QX. used to in hope a raw the we manufacture to and some because those shipping finished definitely of up QX that little and in of of QX, by a start that

Peter Skibitski

Thanks, Great. Okay. guys.

Operator

Our line the KeyBanc. is Steve next from Barger of coming with question

is line open. Your

Robert Barger

the Hey, thanks. bigger for that there will Is topline? given that be XX% to leverage XX% XQ SG&A some rate well? good on Or as

Robert Sullivan

only two I'm a asked that's Steve. glad of great Dodge. have it. question, we in you No, months Yes. Keep mind,

So of percentage. the we Dodge haven't coming benefit realized in diluting scope of the SG&A the and full

it quarter. in improve fourth the So I expect will

Robert Barger

Or Okay. By about that to modeling? any just like XXX think way basis for points?

Robert Sullivan

probably I think right. that's

closer should fall it think in XX% the XX%, there. to I to

Robert Barger

does integrate broader days, take it time them this think, set? And part know nice on to you. how line early was long the Dodge cross-selling, Any you product sales as Got to force. but the really aligned bigger cross-selling opportunity? get I of it's a Realistically, the I

Michael Hartnett

product them Everybody to sell Wild we're say right wants back. the hold West. I'd right now, It's everybody Well, now. trying to else's

saying, everything been between this – the let decide to compensation that so how is organize different two we've So are companies. because listen, – us programs

can be – have just force going man to hired one. – all of and in pick and that's And look, so we're it's before Canada, we we XX sort got to two selling guys a Canada, but up true in we

taking we're now two. So

So now XX. we have

even service how I and of and that So of some management got know salespeople pretty places sizable in they're a XX supporting to these we in revenue. of pronounce people customer the Canada people in towns. don't And Canada name amount

that of selling So country four it's and in that just five country one areas that represented our to it's to are of very but productive. Canada, product biggest, it's five or one is be four going or like those other the

as fact, As organize that coming the Canadians so I Thanksgiving a a how to matter poll far we can here are on week, as of little this. have know,

Robert Barger

I to quarter a that and at end. guess Dodge? is And the point, now that's backlog is increase at the nice X.XX, and year-over-year, Good. What that well, including

Michael Hartnett

Well, doesn't they backlog will. million. backlog, $XX And they running right, Dodge their of much and have is a right, never when like consider what they're

I now... think right

Robert Barger

Right.

ship. Just and book more

Michael Hartnett

astounding a broad a it's book industrial their they broad and they're a able and Yes, ship efficiently so company, it really support the do mix way customer with every to day. to can be manage mix and base very

between and $XX million. I think $XX had right now, be somewhere the backlog is – if I to project would it million

Robert Barger

but of Pareto always of the you've working go in, and know on always Okay. its you good the first? have been insights again, And Where XX that. opportunity initial days question, good Any at to in on waste Mike, an after I areas list thoughts at find trying really And last biggest pockets are? what you just organization. big

Michael Hartnett

the walking XX% in that it. company, that and my what can it's to I'm closer there improve to Greenville, get so yet. and fruit low-hanging in we But so and business a I'm It's I'm understand office a do the folks the and Dodge lot big still making can talking reports not going And to move I the of looking at just plants and where my to is. assessment the

Robert Barger

that Got Tax actually one. last it. where rate And run? one for should XQ XQ, and

Robert Sullivan

Yes.

will XX%. than They few the of But of items more percent a probably discrete the an impact. states good a think a have a footprint XX-ish is excluding assessing impact So we're XX%, little more Dodge. full-year rate of still so that our kind – have bellwether, bit I RBC, that

Robert Barger

Okay.

Robert Sullivan

any impact see excludes through. that start will we And that but will you'll and still those to quarter, from things Remember, blackout be so off come stock a No. comp. come in the eventually coming for

Robert Barger

it. Got Thanks.

Operator

Michael of with line Our next Truist from the question Ciarmoli is Securities. coming

Your line open. is

Michael Ciarmoli

guys. on taking Mike, the for Hey, Thanks chain. maybe supply follow-up.

$XXX Dodge of supply think you seeing the of the made seeing help you announcement, sourced be this suppliers potential realization savings? about I from accelerate increased that Dodge their time, the prices, current supply $XXX million that chain but environment in you've talked Does is chain stretch does the has environment RBC. assuming when internally million to lead

Michael Hartnett

I hope it does.

right left busy me yes, for to we'll though manageable, now, on I work be so work like get that it's way find a think it But going to because nobody chasing that, difficult – it's in. think shoehorn their to going be my their they're synergy and on even projects. a to I to looks attention There's it's little suppliers. they

Michael Ciarmoli

something And about commercial you there. the – up, come hasn't Okay. lot then we've aerospace that and trends defense. a talked Can just

got seeing for the legacy conversely, cuts, have coming exposure seeing or program headwinds any to supply looks either at tightness. down. turned a It outlook that that into those sector like defense you've anything pickup the rates defense chain are F-XX, is the Assuming there? seeing Or you're changed of your Has range programs all?

Michael Hartnett

major I would platforms. on the right the programs – Well, our definitely OEM defense in say the sector, we're

priority. the of where number one So if marine business, side at it's defense you look the still the

right. is as as submarines, So making far I know,

on a bit up So there even topline quarter it is we of considerably be a in the of year. getting little last today. than and up from And our in marine, these second I we're substantially mean, we're and are business, but by and should activities And is. the it what constrained And our I kind are more strong stronger. guys submarine sort mean, up we're margins bit quarter, production nipped which we

solid. is program that So

don't bit, We maybe going it. but I little backing we're off think it to miss have the F-XX, a yes,

important a weapon going important have a several have of Sikorsky, are that And and people always platforms according lot at really good we what the and We multiyear those to form which out for long-term. these platforms the we contracts And us years. they're backbone discussing systems things, buy we're supply. to speak that what we doing with

that side house, looks the on of So fine. it

sector And hard bit. that that's in it's that where field, of the spares side working they we're think little they're a is a it for they're a and I lot the inside we're the bit. because using And to to parts get attract of replacing into parts. bit equipment – replacing business to tooling On enough RBC parts side. not deeper on theory money to spare our organization spend in up house, that My the more a down that of just down strengthen still government

Michael Ciarmoli

All Helpful. it. right. Got Thanks, guys.

Operator

further showing any time. back Dr. to to I'm at call over like no now Hartnett turn remarks. the closing questions I would this for

Michael Hartnett

and XXXX, Good interest the And that Okay. everybody speak February. RBC our in I participating And completes of day. fiscal more for and call the Well, your questions. we I'm thanks quarter appreciate we'll conference all in – for sure good second will Bearings.

Operator

that does and Ladies your for participation. conference gentlemen, conclude you our today. Thank for

now may disconnect. You

Michael Cummings	Investor Relations, Alpha IR Group
Michael Hartnett	Chairman, President and Chief Executive Officer
Robert Sullivan	Vice President and Chief Financial Officer
Daniel Bergeron	Vice President and Chief Operating Officer
Peter Skibitski	Alembic Global Advisors
Robert Barger	KeyBanc Capital Markets Inc.
Michael Ciarmoli	Truist Securities, Inc.

RBC Bearings (RBC) 12 Nov 212022 Q2 Earnings call transcript