FTV - Earnings call transcript Q2 2020

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Operator

My name is Nicole, and I’ll be your conference facilitator this afternoon. At this time, I would like to welcome everyone to the Fortive Corporation Second Quarter 2020 Earnings Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] I would now like to turn the call over to Mr. of President Vice Whitney, Investor Relations. Griffin Mr. may you begin your conference. Whitney,

Griffin Whitney

of Lico, these and Good Thank Information With section the Regulation thank Financial XXXX, Jim Vice Chief President afternoon, are call Investors We results website, on the www.fortive.com, the our you call. as Financial certain heading, continuing Chuck on available on Nicole. have non-GAAP Officer; us President results relating based are and Executive G for Xst, the are; our and call. Information. and today’s Business The Senior A&S the presented divestiture non-GAAP discontinued under measures SEC on included October the everyone you, financial accordingly operations. and required of McLaughlin, on and Specialty financial by on joining operations this completed today to of Officer. periods. We Chief for the our Automation present Business historical us measures

describe financial During and that to decreases the or basis. presentation, we continuing on period-to-period increases operations All certain of year-over-year a performance. impacted more are references year-over-year factors metrics significant the will

During like today. we that assume make do uncertainties, statements statements speak With results might meaning I’d over actual and actual we the that, and obligation date update regarding differ cause to in the within Report Securities regarding any are make for statements and are year our only they any and that forward-looking turn any number available to not SEC will to Jim. of subject ended these or forward-looking December from from risks Reports statements filings, on Form the that events forward-looking Laws, results subsequent including to these the These may on Quarterly is or the statements of materially a materially factors to Information including we of the XXXX developments may XX-Q. occur we made, differ Federal or expect that forward-looking Annual the call, our XXst, will statements forward-looking anticipate, future. call statements. XX-K Form in forward-looking as These

Jim Lico

and the of of Today everyone. quarter adjusted XXXX. per for afternoon, $X.XX Griffin we diluted net second share earnings Thanks, good reported

XX% As continued our with to operate comprehensive employees. tools team proactively leveraged a new the the marketing production health despite of manage new all engage to continue than strong supply and the us system was ongoing created forecasted free business the revenue the we to executed better very we cash difficult the the reflected a continuity, to on operating of savings maintaining margins sales conditions Fortive the management, to shift chains, power delivered our pandemic. focus generate virtual to the that of despite essential performance and enabling COVID-XX our clearly world achieve and as capital virtual by a protocols With protect flow. working around facilities and on Throughout quarter expense, playbook and safety we while It decremental adopting quarter, customers. environment, our of Fortive

operating we ahead also We an with continuing environment this project competitive continue order processes COVID-XX the posed invest April, When adjusted the to enhanced in meet to a to challenges position. the faced from period highly to development earnings due in we pandemic. to product by emerge our portfolio timelines, across looked QX call while on uncertain

total than QX, revenue accounted share of Fortive. for built resilience with recurring revenue an for over demonstrated from Our four a software into past in set Recurring QX performance the high of the subscription-based of XX% offerings. expanding our and revenue increased the more consumables solutions, portfolio years, new services we

progress for a of out elective early decline source team pandemic. position Importantly, We macro weathered Mark systems fact the With Products experienced our the surgical the of world in that organizational guide the structuring evaluate the in months company. of made the as the Vontier forward The via have for spin procedures conditions of Dave recurring Advanced the and issued highlighting to separation we either as despite its a prepares at Social conditions, in important capacity across resilience our an the soon separation came Report as for permit. while key can the a Vontier, on QX through the and or respect through from recent continue around Sterilization preparing to QX, additional split. we move this healthcare options progress revenue Fortive also as teams we affective Fortive our as over remain the businesses public challenging to its market as year. separation Vontier independent the end made Responsibility past leading an Morelli most future Naemura build Corporate Vontier’s portfolio continue

into diverse an at of our organizes which breadth have always in Corporate priorities comes inclusive capture belief we building initiatives the teams, to framework our full the our with around Fortive. Responsibility. aimed strength that Consistent from Social strategic pillars, CSR seven environment the Our cultivate

past broader teams the we to few months, our have of acted addressing Over values advance justice. themes an these dialogue critical internal on about help social

high revenue the net to Vontier basis quarter. of earnings our and of efforts. to contributed turn were million, decline, software employees declined diluted Fortive growth, and earnings billion, Gross including a strongly points. to of growth significant With well a disciplined and the impact were of reflecting and Social benefited XX as the Acquisitions share our execution. to core prior that, in contribution QX adjusted values points basis foreign XX.X% the XX.X% $X.XX. in our $XXX.X $X.X let’s exchange basis down chain margins and XX% commitment Total from XXX held details XXX per while Corporate rates businesses. the of pandemic. sales Responsibility currency equality remain of Adjusted net net unfavorable supply our diversity, by margin look the adjusted negative margins reduced by culture price our continue will – year supported points we also XX%, our growing our to Gross and teams up communities, increase committed key at As inclusion the tenant fulfilling living from COVID-XX

response challenges, million total Given deterioration core decreased This operating the margin top the XX.X%. margin than and the basis greater in $XXX actions executed macro XXX quarter operating line points, economic resulting reflected of profit widespread operating adjusted margin of an during conditions. in to adjusted cost

resilience quarter, performance of we FBS generated operating second The proactive adjusted free and million also across cash of tailwind generation taken accounts conversion net from few free driven capital the representing flow of of cash, by receivable portfolio the turns past our driving a using by working It over portfolio the years. improve the $XXX increased XXX% During inventory response strong transformation earnings. specific million $XXX taken to companies showed cash QX. actions flow reflected in of free

including XXX including exchange operating margin points, in posted XX.X%. a of basis decline while Acquisitions XX.X%, decreased level by core in of margin XXX a adjusted Turning basis a a adjusted exchange decline segments. rates XX%, Core Core revenue. decreased decline a level Unfavorable sales XXX total XX.X% a to of revenue. XX.X% in reduced XXX unfavorable core segment resulting operating sales in XXX margin our Industrial Instrumentation points. points, basis of foreign growth basis points. Technologies total points, Professional decline growth contributed segment currency rates operating foreign operating posted resulting margin by reduced XX.X%. basis

major geographies. across Looking the

down Slide COVID-XX headwinds, impacted in by relative each QX negatively region-by-region Asia, to of revenue QX, local of X declined representing The from quarter to presentation, expected. quarter. regions than progressed. as what driven significant single-digits shown the earnings mid primarily in terms be In the on by public continued ultimately prior as progress core a performance in low well as dynamics, in the China as China. reopening, quarter improvement Our the better broadly health was double-digits economic reflected breakdown, was

China of back see back the to continue as February. they experienced progress steady across climb our from in low businesses point We signs

QX, We experienced China improvement QX, of ASP surgery approximately XX% volumes the the at prevailed signs sequential to ASP significant companies levels year-over-year prior of and that trends out with coming positive back growth. point-of-sale of to and in for Fluke encouraged improving pandemic. the elective All a businesses Tektronix including returning were to Fluke of number major our and operating onset in the by including of

by through reopen. and capital and to Demand in markets. stability across of QX. surgical Southwest then for which some of required. for the consumable to of significant any over line from software weaker more improvement access in posted saw place across India COVID-XX top EMV at better of pandemic. saw The This reprocessing for quarter. Looking associated That improving likewise sequential procedure procedure total and North with the severe early put and trends of Asia Fluke in challenging. Tektronix, rest the the saw remains as resilient a signs America Europe possibility We June, April country hotspots lockdowns total decline incremental lifting infection majority course NXX significantly half coming and and limited our of declined Notably, the economic although particularly economies remain and top growth in and significantly the said, in volume. the April line in May quarter businesses, decline further resulting back also North in many particular, relatively May the services access customer revenue create high-teens significant over believe for single-digit quarters. Japan the began high-teens improvement Western Fluke the Sterilization lockdown in better strong then activities, prior implementation. the while showed related rates a in Europe, largely limited performance expected revenue Asia, revenue. rising improvement to much core of the continued of declined a sequential expected as demand the ASP was continue India, of sales – quarter progress still certain driven of the surgical America light challenges for with in be may improvement region widespread sales drive important from QX, bit lockdown well into respirator trends resulting the in than Southeast POS trends helped the re-imposition in monitor and for measures Terminal core QX, sequential bottomed elective revenue QX, the does in GVR US marketing onset QX. which a revenue while similar in down to as and region measures, improvement Western sequential in to as expected low to than and was June of Improvement high-teens The and across the played out customers we of QX. in provide and benefit volumes, Europe Western risks offset

we in Weakness and impact combined Finally, a saw across mid-teens East of Middle region the XX% oil the and pressures a greater to decline the East than and challenging in tied in in COVID-XX budgetary gas the Latin market. the reflected America. decline conditions Middle

Slide than these While later regions, with headwinds bit both Mexico Latin and our businesses America challenging experienced in particular QX, significant will impact with anticipate likely throughout the framework We as for end spread Brazil. that laid the relative disruption demand. became conditions we and deterioration of in to presentation, a XX COVID-XX regions remain on other out look organized we pandemic quarter, a portfolio the through based of year. found today’s of for into Last resulting groups market and on sensitivity businesses analyzing our the

flat. Group Fluke’s Imaging strong the which very from out slightly Slide and Maintenance grew performance SaaS at The mid Accruent four a quarter, Industrial single-digit and in a shown QX indicated from of up XX, expectations with the Intelex single-digits, growth Groups’ drove & groups line the business, represented As number to significant growth QX in approximately contribution high COVID-XX where of our for I much quarter. eMaint the demand played strong resilience total very was also Gordian response businesses, the challenging Group very showed benefited strong was one, grew for reflected despite portion XX% mid-teens, the across performance the on of conditions. quarter. software in customer relatively economic our revenue posted in

a continued broader the about product the strategy. excited We’re for accelerate potential and these demand Fluke at Imaging trends to lines near-term Industrial

decline, the XX% total roughly mid-teens II, XX was lockdowns. expected, quarter the As in QX in revenue the expected. in revenue resulted the impacted half Group’s than Group of which significantly represents of back quarter early points improvement approximately over Overall, by better

of to faster experienced procedure and half levels COVID-XX. the where consumables higher America. saw demand was to orders across in ISC’S performed pressure we had highlighted which resilience saw COVID second those we partially XX% in calibrators quarter, began quarter first core subsequently and in the Europe which by a of the to strong single-digits revenue ability business offset in against Group for For GVR, usage AFP, mid-teens by at mid Elsewhere out the quarter. the expected deliveries as Fluke decline. its number infrastructure orders increased with anticipated grew revenue performance to II, convert volumes as upgrades North QX. the lockdowns QX industrial medical was and in iNet troughed well related bounced the in datacenter as a than to which to for recurring Despite end second fight than surgical single-digits back our year, markets. low in in models the markets. III, tailwinds strong see saw strong but during a Sensing the quarter. US China both significant At Health by higher end approximately of lift. provided the ventilator group’s the Solutions, driven QX, pandemic growth the recovery continue total represented Western drive QX early liability in for our This demand The land Matco, Solutions Elsewhere, push in pressure better in to related upgrades than impacted in business bookings Group semiconductors portfolio of also EMV demand Fluke in added Health the dosimetry of in and decline, then

with ventilator address earlier we sheet, our ended their approximately resilience, pressure almost QX, in Gems and addition headwinds undrawn, its four point-of-sale delivery our in posted performance quarter major revenue, $X improving to to business revolving but Asia expected cash April. and XX% components, expected and half. and Accruent’s line quarter. we capabilities for the POS businesses in anticipated billion Fluke’s cash XX% IV regions, experienced anticipate margin Group decline. strong billion saw with the the quarter. Professional flow second environment execution demand which Industrial Core improvement of That us improvement in pay but remain showed in debt of signs in total Setra in business strong restrictions positive represented generation business enhance most some QX line related facility. as Notably, our quarter, Tektronix the Europe Conditions The an new challenged, quarter better balance safety faced and the across improvement We drive of and in second help enabled of products and with said, than on top expected in top $X had as down the adjusted to liquidity Instruments largely US with continue the off credit at in early saw remote the Services Specifically, in respectively. QX sequential combination improvement the critical and Tek over substantial significant protocols position in later COVID-XX quarter second sequential during as to The lows. China. performed Group

data driving products an challenges growth enhance and our investment capable Sustained offense demand next bear to incubate has its capabilities there FBS the processes. and in same across by partnership form to the and to products new dynamic COVID-XX. learning Square FORT, help in portfolio, bringing to plenty completion to our to response critical at our growth critical Fluke to including centralized address potential resource to internal enabled in on using enabled development technology were In generation analytics address TNXXX invest our position. The development emerging of for core has expanding cetera hub products, analytics of advanced to machine offering expected more investment bring continue et forward. by growing our Navman, Telematics using the to going long-term immediate to innovation remain part accelerator while as intelligence we is focused portfolio addition industrial also driven initiatives While platform, which our quickly the of our running across to of companies breakthrough We Teletrac growth solutions, accelerated also market a play longer-term key such Imaging competitive established playbook a QX, we opportunities, process Labs allocation companies solutions, of Industrial May, operating the in with workflow opportunities. to our the of fund newly artificial fashion use environmental in introduced Pioneer

Importantly, commercial our investing among our software expand we’re also to operations, particularly businesses.

associated trends color but with better are rates is for with under additional guide, potential coming QX, remain future with providing sales We European respirator ASP, emerging on ambulatory near-term our continue to in At NXX the to we the light volatility. saw quarter, address in and control. global not Censis surgery build efforts outside performance out on conditions challenging team continued are opportunities we team particularly opportunities the investment despite COVID-XX sales Intelex’s This to we center of in the customers for quickly help capability of macro reprocessing to in attractive QX, expand Consistent expected capitalize service keep coming persistent address the to US and quarter. reaching Despite of growth providing opportunities. the infection the the challenges enabled challenges market. the a

but to total on expect X% that by year-on-year a basis. in X% revenue sequentially We will QX, decrease improve

line manage progression any continue actions approximately as top calibrate based on XX% decremental margins in to here to from cost we QX. will of the remaining We

As greater conversion ahead, generate flow year. of XXX% also we adjusted cash deliver to flow and expect than we of a the to cash free net look continue full for strong ratio free earnings

second The of quarter period. unprecedented was XXXX an truly

to unfolding global of the health significantly months performance that exceeded ago. the had three to our macroeconomic expectations financial an delivering and deterioration global crisis, we quickly We public As resulting a adjust weathered environment. storm

the performance resilient such, past over more a cycle. demonstrated have made and we our through portfolio flow with QX cash the As transformation progress four establishing performance years, sustained line our top the

foundation of we and importantly, the making that lay forward investments our team we continuation More leverage the collaboration development new portfolio looking innovation will by continue to the as our virtual tools, FBS develop performance of for transformation. sustain the in groundwork and

I’d Finally, I to am generate proud undoubtedly our coming customers, ability we turn while quarters. in as them and we past team’s our navigate Griffin. and months, the to over face challenges to value for With substantial continue efforts confident that, extremely over in additional it like through of our our to three communities. the shareholders I’m employees,

Griffin Whitney

Nicole, concludes Jim. now our for comments. formal Thanks, That ready we’re questions.

Operator

first [Operator with question come Research. Coe from Nigel Instructions] will Wolfe the of Our line

Nigel Coe

Griffin. obviously Obviously is Chuck. and evening, you sales quarter. what Jim. a quite XQ, realized down Thanks, pointing pathways the Thanks, range of in towards than afternoon. April Thanks, In know, the Good what you know you good bit better you’re then

of how exactly what here. but blah, But know, we quarter curious, I’m So July? organic know, progression are you into necessarily blah went as in through you seeing, you not terms just you by generally, through you don’t and what business, we do just sales and June-July, you went know, to know, as the see want blah, I,

Jim Lico

I quarter. prepared certainly progressively Yeah of said to got in things thanks, as got a think of the better relative we as through But, sort couple we the Nigel. we the remarks, things think trends, I

got you good good July certainly confidence just trend I bit the think perspective. in probably as in little guide. us is giving from and better a to but as well, of So, every is month know, a sense the

trends are better. think I the So, certainly getting

as the the, to you it’s trend, and they of they’ll is difficult know, we the the going think how as know, a think the at pretty another said, back of to we long driver, like like near-term good better getting certainly end know obviously, but through is half. I have good. sense look we continue fourth hence I quarter, look you look a what And example. in macro EMV That’s necessarily

is elective tech right So transit still, software certainly little surgery staying some that Professional a on and side, as the bit you the resilient the really industrial be covers better well. and of Fluke trend, on starting know, Instrumentation the POS to business

Nigel Coe

you very Thanks, have encouraging, the you know, decremental it, margin the to Jim. a you of on good cost know, really And I you you XX% decremental management obviously were seem had know kind margin for side grip gross confidence that you maintain firm margins could, there. outlook those bring or that kind XQ. into range decrementals back like know, you out of of put

to about, know, think range, your in trends into the XX% we is XQ? or continue sort for a to we XQ that Thanks. should better in to you scope there it see XQ, know look So improvement you of be XQ if

Chuck McLaughlin

Hey, Nigel, this is Chuck.

business to line I better what manage time, will to guiding on consistent that top seems there. at the At think in a we’re deliberately that say move forward. we The point this that’s with least, is as and trying is what XX% it we trajectory. we’re

we investing the that future go that our forward. strike we’ll into of as expenses managing So, balance and

So XX% number. right is the

Nigel Coe

very much. you thank clear, Very

Jim Lico

Nigel. Thanks,

Operator

will question next Research. with Davis come from – of Our Melius the line Scott

Scott Davis

guys. Hey, good afternoon

Chuck McLaughlin

the Scott book. congratulations on Hey,

Scott Davis

Thanks.

Chuck McLaughlin

book. Scott, congratulations on your

Scott Davis

basis I’m you you is a where, that, Yeah, of to thank some right. know, call I you’re you A encouraging on I it’s commented to level earnings probably for or the increase you’re didn’t just point XX have today on commented price revenue of and I base there sense of Jim recurring you. bit little overall price in a think a I’m that XX% get now, little pages hope pretty – know, that many get basis everything or sixth people that Chuck. you in, But is that, sorry, sleep. board? light, come thanks power so able But – other bucket a couple pricing look up. helps beating now the and points trying across actually like Chuck, fifth here XX generally out more

Jim Lico

Yeah, were too. price had have been really you as good frankly, encouraged we’ve quite know, the comps on know, pretty you you good we know, and price

know, was it Professional get quarter, you in to that So, in Instrumentation mostly the Scott.

say of were So, we certainly that. had the part and businesses But software good you would I mark. know,

You price some like know, hardware we had good in key well and Fluke as businesses of Tek. our

and we So I know, $XXX board about playbook in our as think we teams is certainly through expense across I you trying about that you in they the side, those effort, think the rest the opportunity the I of the And did continue try you where opportunities advantage them to quarter, do on the an that will think think but we talked quarter and know, playbook, million exist, to of part exceptional to took of of for know, find cost reductions price. also the year. while

Scott Davis

line top there? Vontier Okay, profile there you some profit far the decrementals was like profile as the that or differences consistent the, such, and overall gave fairly as look then rest with of Fortive and profit the encouraging. growth and cash And the was

Chuck McLaughlin

decrementals, margin there’s No, you I a all operating in different I the to terms that hundred the don’t at when – bit you behave a of two they But think don’t segments. by that basis actual difference little get points between look the couple the when two. between – profit

Scott Davis

luck. Good helpful. super Thanks, Okay, guys.

Jim Lico

Scott. Thanks,

Operator

from with of Mitchell come the Barclays. will question Julian line next Our

Julian Mitchell

around in to a outlook, Maybe third bad quarter XX in more Hi, to dialing help revenue the good about any to and/or you you versus second so detail just improvement? point just PI sort you’re driving back on in what’s quarter. afternoon. us what narrowing, you than for year-on-year Is saw that segment the know, a that Group the drop basis, I there circling on could basis provide IT, around understand either IV of that less

Chuck McLaughlin

of just And improve way, at to this bit is going sequentially. both had as look continuing some We’ve what’s going you to improve that if little we that got are that’s a got than by impacted single-digit lockdown. look were in move out could when low you PI, more strength you improve. bit where sequentially seeing, some coming from going the think those Vontier. QX a acquisitions then know, to you to that’s a and helping that’s I the And the Julian, Hey, be IT, as going That’s Vontier we little you it think doing and improving, really, low a down got at we’ve secular GVR, of lockdown really off. you’re – IT Matco the And really Group, single-digit Professional for well getting of lift know, know, show trend these are is gets of EMV then know, think – about to you there. – the that We’ve Instrumentation, released to these quarter to more again, or

to QX. improving in down I’d that single-digit see So high

Julian Mitchell

was question around think. first the plus in half up flow. cash, big And I particular, in a in the Chuck. free you, cap There generally of second freed a cash tailwind working then Thank QX, $XXX million maybe receivables,

to capital around on free as improvement which So profile. business in ASP outlook you’re you’re maybe help the us understand what’s happening extent that flow the working the an seeing improve in this seeing revenue second with cash half

Chuck McLaughlin

shot a at them and will few comments. take a me Jim let probably Yeah, add

cash I think there, million a know, you and appropriately, take managing about saw it’s – million. of And think by tailwind overall very example on look us we managing from of things which from capital you a just push. that QX an you is the lot and great good $XXX think that flow getting inventory to our level when everything teams was at work you I know, can at a, strong gave and manage early, as you a know, QX that because was working $XXX in

steep improvement but that really depends to sequential it Again, going not the increase second half. forward, a back on a what coming a on It’s of would expect know, I’d the the to I that a going level. But how third into probably, I at bit a maybe it think little how continues just as expect same steep half is. tailwind. really the of be tailwind quarter-over-quarter you depends

Jim Lico

I Julian, things. couple add of just would a

You know, what saw number flow. one relative with to is, we’re free cash happy we really

talk You of working checked it have we’ll time The lot actively us know, that quarter. I last doesn’t weren’t managed. about capital last times pay in customers those be a way to a tailwinds a hurry that to in suggests

less, think we know, mode year. know, in will. once XXs see less I we up at is the, when the into think would much were XX you’re that, cycle. year know, work keep I advantages going we the FBS And we – it for using you know, So get the would flow, preserve, of about we second you XX range you I’d historically, little capture we’ll look – a you say to that and the that. the the profound. for know, know, been than and you better It’s we’ve was what add in growth into, free really know, you thing talking that four quarter, I we those full did, than of percentage – in think, years. down, less in or also cash said what when can better the using we better Obviously, you to is, we we’re in to the And second we’re down you do bit quarter, you those saw a if somewhere

quarter the in higher particularly I were around strength margins gross PII margins is of software, the seeing PI gross around XX%. you’re what in portfolio, think our think the I So the for

us I So ability the will confidence the good cash out changes as more free of free cash portfolio, year of given remaining the think gives to be that part well. in the drive some also the

Julian Mitchell

Great, thank you.

Jim Lico

Julian. Thanks,

Operator

question next line Jeff come Vertical. with Our Sprague the will of from

Jim Lico

Hey, Jeff –

Jeff Sprague

or morning, Good afternoon, you. guess. good everyone Thank I

Jim Lico

evening. Good

Jeff Sprague

Just two for could. me, if I

on on Just timing. Vontier the

You know, has you extraordinarily this timing decision is your that looking waiting to make here? or been you’re for know, market for obviously What on it resilient.

Jim Lico

forward are for. was things time that QX our looking trends know, and are a a And bit now. still is And we’re the Well One, in you for I and see we know, But direction. we’re you volatility. market, couple definitely strategy And going need or think get results, by we’re where bit just prepared get couple looking execution. committed while then with going to a time ready not the encouraged a with think go, to the of direction there And the going you of know, longer to here that, little ensure more it – out a correct. also, little know, ready are you obviously important period. week right convinced that we’re we’re continued of for thought in to We we’re out we’re looking here, to nice Vontier’s probably separate. right there’s markets we that stabilization the to we’re we’re for looking to the

just and bit time we’re more stability. a So waiting little for

Jeff Sprague

investment, so, about And decremental, Chuck’s just managing to thinking you actually Jim, know, point, a to right. you’re

So sales are going going free spending. better, to up to that’s come in

going most choke into that know, of of, that a couple Should kind restoration know, there’s temporary of, delta provided we I you working of in assume is expect to down had would you you second the You you growth here some things quarter? know, kind or on here you’re just on. examples what

Jim Lico

this mean, first factory alignment really chain supply about you and we of with know, I if some is, and the focused quarter. foremost, managing we which opportunities, as part is then you think, work foremost, resource going highest saw teams the dynamic going There’s you’re actions. first gross is, the set think at. of the on I temporary around to those Jeff, moving money revenue you where actions, to good in there’s of allocation, down, really will, the permanent cost we’re good, margins, And capacity. cost see there’s fourth about playbook which and on the of Yeah, you And part know, and that think do we, the

the managing things. decrementals we’re to So those relative

are I really We’re making going for were cost growth permanent the months. outlook those FORT, they good think inevitably most data important as analytics ago. example going our projects year sure less thing, understand the create And or where temporary from advantage time. up where about the are funding But is, in more making reductions the more are XXXX. probably really the and projects Xx we’re into competitive decisions we that we a coming we’re you’re over businesses, is opportunities where to decisions A bring the

data a we the times doing analytics doing that projects we’re number of year So X were ago.

I focus. big a that’s think

what I companies that’s about that lot operating and a really projects hearing You’re internal companies. for around And Fortive. both digital FORT is some think leading transformation at we’re the we do that doing our for

advantage occur, know, facilities, know, where, and take that’s buildings. software example software changes safety all to to other the of example. back investments businesses exist that of is, challenges accelerate our businesses a lot continuing we’re work, in facilities that one going you protocols the number – one a I of to are new the Maybe So able health in safety you our and really of the in think

really take the a our those an as opportunities. current of so at as our sets And advantage to solutions feature we’re our Gordian number well pivoting both really and of – Intelex

increases of we going some real over So where drivers those a number of our investment time. things have, you secular I are in good know, towards think

Jeff Sprague

And just color that were revenues you gave was quick Julian’s given? that revenue? I commentary I if could. revenue A you or Was that Chuck, question. clarification, think organic reported one to

Chuck McLaughlin

most organic wrapping think acquisitions organic, It’s we’re but of our that maybe my for here, was I although Censis, comment.

Jeff Sprague

Thanks. right, great. All

Jim Lico

Jeff. Thanks,

Operator

question Obin Our of next the come line will Andrew from of Bank with America.

Andrew Obin

afternoon. good Yes,

Jim Lico

Andrew. Hi,

Andrew Obin

the of of is and this know, a how how think at much as quarter? know, what you it the business was Core you the the performance we question it in business today, point, is Fluke, of Industrial Industrial Just much on sort ex-health at Core about,

Jim Lico

at range Core piece you IV, – would that – in think our maybe of the that in Industrial probably think sort probably that’s Industrial be Yeah, which Instrumentation, I when XX%-ish, two-thirds Core our about XX I look Group

Andrew Obin

And –

Jim Lico

And maybe a little bit up.

Andrew Obin

you, okay, Got okay. now,

Okay, that clarify Accruent And then Gordian on just just software and makes to sense. performance. question a

it’s correct I marketplace a just, Gordian the volume model, know, down. platform as is am so revenue you through So gone that

anything you And sort going depress besides revenue? impacting what’s that’s else transition it. know, to on Accruent, the So of SaaS license to

Jim Lico

also one Yeah, the we some that’s requires get with started. right Gordian Andrew you’re stay-at-home to know is with you exactly working very first. customers obviously really some so I cases. and model often get from with customer on the yeah on-site And so prevented know, work revenue They you in were – their orders, interesting, think you that

you some new there’s So, going new about it’s on the often not really that construction, in question delays, facility. construction, know, but it’s there’s we no – are the changes really get

around on ultimately, changes and protocols the back. start revenue come ultimately And a be, that will grower still little in there. COVID that you construction back going will think, said, and we time quite in get They’ve know, a know, that you business you to we with now, facility got – flow double-digit strong know, think will Accruent with double Gordian you So mode. a great purchasing as for growth will been, back required everything more the as opportunity dollar we’ve bit complex through regard. some ��

in really facilities And tied saw You returning our our facilities businesses. high and which is good seeing to in continues good. EMS our management be lot Lucernex, know, lease to opportunities to Healthcare businesses work, some, business, and Connected business we the a really cloud management are assessment growth of work, again, are that we’re

durable. little parts the revenue side. Where those continue much we they’re got get be think that’ll the Accruent the really doing resilient. So working the with to do part we’re in able the challenges And, will Managed third better prepared portfolio. think like side, I’m SaaS remarks quarter more of And SaaS as of there Service able saw at back basis. and on bit is customers I remotely. Managed quarter, to the to we through are know, to that a – getting the work again, you more Services of getting to the of on be done the still work end the license continue regular still be businesses to we a better were But – And mostly Accruent on we know, the said again, some they’re the on-site of our sure. be, got some one as And you

Andrew Obin

you. Thank

Jim Lico

Thank you.

Operator

Stanley. Morgan of Our line next with question Josh Pokrzywinski will from come the

Josh Pokrzywinski

Hi, good evening guys.

Chuck McLaughlin

Josh. Hey,

Josh Pokrzywinski

Hope everyone’s well.

into of that go couple mine, a you versus do guess, a that? score against through you questions Just other bit know, half. kind of when second How chain and know supply of first distribution, you and here on carried kind mind you the guys come delays sell-out? to Fluke for I for of distributor characterize you think businesses backlog think How first. seen restocking, guys Tek sell-in in guess, do cycle you we’ve some I short I know,

Jim Lico

think I negative. Tek you saw bit Tek, stable, more bit we did trending improved, an we know, whereas, would know, improvement, but little better you point-of-sale more of a at than I it Yeah, little a still but Fluke call Fluke got maybe at

Our to inventory down, say, inventory built. real remained I flat much, would positions have pretty so no

issues anticipate we to inventory. So I into relative half, we think the second as any don’t get big

hand, expect inventory. take the to don’t necessarily On distributors we really other on

the continue trends So usual, a third point-of-sale. on nor bit any about swings dramatic inventory, point-of-sale, at the little get which sort everything embedded we around sort as end the better. increases big they the to for day, of of business decreases what guy in in talked of or means, assumes big that But no

Josh Pokrzywinski

it, Got question Jeff that’s you guess, timing. my took Vontier And I helpful. know, then on

So a ask one. different

know, some II that can would and cyclical or, this kind we more know, in down mostly, have or On do you the business been I M&A assets the choppy room those current bit you’re is shifting around – as four into are amongst the does are I to you current there you they’d and attracted be buckets we of that know, Fortive? separated, kind a buckets that of obviously, are breaking expect any but kind businesses maybe buckets? how later for give of little thought those mean, environment you environment to this just manage still

Jim Lico

Yeah, it’s think I a great question.

years think, have the we Group the deployed I you have, lion’s groupings last as our I a think clearly into know, using if II. demonstrated and over grow, propensity M&A share know, mostly Group of the to you them. obviously, several We I

for to digital going That Fluke trend there know, our which say is was would we aspect – trend would you you situations, service the So – really a will offering. are that think would say deal it, know, said, had I instrument to that certain Fluke, I and an PRUFTECHNIK I year is both continue. overall last the to that did important that

it and that high in case got we very at ROIC. a So very,

is our I said, what tend to we if let’s about find high. lion’s be really share the or focused facilities ones in to several III safety those deploy in here But Group very the groups some it’s say see the in they’re to I in which they’re and where over be of monitoring, capital health, the the things of going and going articulated those talk on we’d is, share decisions capital lion’s that return would So, are last II. are And the healthcare condition four places years, you’ll IV, you of think building that next environmental, over group do management, enablement and our years. make if we allocation like I

Josh Pokrzywinski

appreciate Good the Got guys. color. luck, it,

Jim Lico

Thanks, Josh.

Chuck McLaughlin

Thanks, Josh.

Operator

Our next question will from Richard line come with Eastman of Baird. the

Richard Eastman

Yes, evening. afternoon, good morning,

Jim Lico

Rick. Hey,

Richard Eastman

couple Hey, just questions. of a

revenue that defined including second revs do as and I recurring XX% software how you did it, were But you the services revenue, the they’re of did of in were year-over-year XX% in a I recurring, quarter? that high. just think you around you Jim, quarter and Fortive’s new kind mentioned at the and of bucket think consumables First, how know,

Jim Lico

opportunity we’re the on down software I the have the about businesses, the platform into say, then sort But we’re the is Telematics, know, software mid that as into PI to the you launching, single-digit. disaggregate it up – about of the Telematics know, were here if you side, have thought obviously, mentioned, forward. that think know, would I Well, business But, about excited big quarter. groups. I going new would related I you for Vontier the they we And you in

of which gives kind of look of mostly down. to that So sort buckets, II software the Services, probably, like. know, the down you Group view are quarter you what in

low at dosimetry single-digits, quarter, I business something think Landauer was down like was as You the services know, example but in I think Tek up our an that.

bit. and So I parts than Tek the of a service probably at the portfolio. the the as other much know, which of Landauer probably down parts would you But resilient say still, business, Fluke the more Health little obviously called

Richard Eastman

we incrementals? year know, XX% on I the a about balance got a just here you decremental IT you, of the year software on side? as around what okay. have our this the for revenues, or to is mean do manage we side, I there? would start you incremental content, for And more are know, think appropriate to investments into managed Vontier, around, You How view margin cost discretionary we next for, do then what’s be question on question PI to we you for what we and just know, the the have manage as more and PI cost recurring an Vontier? what

Chuck McLaughlin

place is is think reset that starting we Rick XXXX. good back our to to want a starting went the down, I amount we we’d because would that come Yeah, same back that Chuck, growing to on this up

it back think revenue and recovering if down coming XX%. of XX% went that it So I at at

of – some business know, the that, our have we’re growing obviously you really as as higher move on you Beyond mentioned, depends it some of time. decrementals, software where you in forward

first of kind after is back. but get So depends that, to thing

Richard Eastman

Thank very you. Okay, good.

Jim Lico

Rick. Thanks,

Chuck McLaughlin

Thanks.

Operator

from Joe come line will the question next Our Cowen. of Giordano with

Joe Giordano

Hey, guys.

Jim Lico

Hey, Joe.

Joe Giordano

quarter. $XXX mentioned through of kind outs, million the you you can Hey, this go cost in

break the like business you balance come more As things you how like kind for the permanent look temporary things the quarter more normal you that took actions are when to out savings? for that the would and versus that that between back you of to year, of know

Jim Lico

or for year? talking quarter you you we’ve the for the about what Are done think

Joe Giordano

and you versus the for in split in the the how of million temporary guess, kind how you quarter, magnitude about $XXX you that break did and out of rest like the thinking I what remarks year? mentioned permanent do the would prepared of you’re

Chuck McLaughlin

easier back to up. – for so little think let in year. quarter, think talk about I I me the a the It’s that the

not that to all million or rest $XX QX, next go strong you paid how third top the [technical know, anything QX or being took million next we that on, last year a permanent you will in of the quarter permanent year, the into but on we’re we’ll know, need know, we think I and – we the is, take, recover. think let’s million] is be obviously you and that – year little $XX likely QX action $XXX out, QX, million played that. top But we through in know line we we’ll where that we have through it nature expect as of and of particularly less if would year than more year action, – of on I in the actions as do permanent And did that’s have in think to quarter, plays whether [ph] the out the really how then of the in difficulty] it obviously, depends [XX [technical see view difficulty]. the see a a to going taken permanent

Jim Lico

doing because how reduction, understand we now, necessarily that trips of part you part we’ve quite And, we’re can much historically getting and know, working know, customers of that you you the made. need become know, cost digital, also Joe, real reduction in with through permanent a don’t obviously just we’re our substantial number our travel. that of is travel work make to virtual much very frankly, that expenses, a we’re

that, in better we things outlook frankly, typical then decision, much we decisions are I amount you about, – very as certainly, XXXX, aren’t of think what not think would said, year. as temporary, – we but considered but to that as move can will look significant quite incentives the have historically next are sense that once as think be travel also going a permanent like those and things we it’s the I but just like be make them and into know, of that costs Chuck a So think we revenue like

Joe Giordano

volumes on That’s fair, procedure though, my was interesting. follow-up elective you just wanted the guys that to talk mentioned

in North XX% seeing pre-COVID. XX% said to You XX% America, XX%, of you’re -

just kind of the like the specialty some like reflective big sounds more rate is having of of flare-ups the we’ve that Some And were Is but of hospitals XX% of And you the that how range. I’m places just the that now is like checks hospitals, in of on it more curious did of how facility? are toward looking kind some view? with is and – Florida specific geared going what’s type that a again? in that

Jim Lico

prepared as been have our clear. so Yeah, may remarks not

from end data the I China XX%, getting only – in range. We our pretty through quarter, definitely sterilizations. up the through get So think of quarter numbers business we through we back hospitals sterilization the I back think XX%. have and we improvement at third And around the we’re see it see But think in we the to well. as to as we not then. with the our data by don’t understanding day understanding the of the end would continues seeing that we Censis what US XXX% now think, between get see But are yours but continue go a hospitals, agree got frankly quarter, procedures are. sort We see quite to we the at continued of [technical way the an it and we we July XX% have difficulty] good software a even with don’t get still the long of really

you dependent. as [technical type a little So bit But is it we of difficulty]. a continue said, think will of things facility

Joe Giordano

Thanks.

Jim Lico

you. Thank

Operator

next with will Andy Citigroup. come line of question Our from Kaplowitz the

Andy Kaplowitz

guys. afternoon, Good

Jim Lico

Andy. Hey,

Andy Kaplowitz

color sales us you your more can give breakdown. maybe little Jim, a into regional

You regions the QX. outlook improving think and see the about versus revenue other even you US you Does regions? mentioned in QX for your, generally mid to LatAm QX, QX at or positive in sales the do into were improvement single-digits the instance, down as or all generally lagging that rate same are turn the

Jim Lico

QX wouldn’t and, Yeah, know, on I think, you I backs you know, measurably Fluke. ASP as you better was and that in was the you China know, than said, QX. of –

second dramatic get second growth don’t think the rate you in through I think, but any know, half, I better necessarily to China’s that half. China the gets to going

you don’t gets think I think significantly to seen think better. get we’ve things that are enough to, going better. it I But know,

this I mixed. probably China better. think The I Asia, little here rest theory is at think point So is our a of

many we things we by As respects And driven but of by to of there’s the but we very a India in India lot number pattern order of lockdowns. have there’s – continues our end the the And think GVR is the think – business. mentioned, business year, money a that good. and that been

year. India think the better end get the we by of So might

Middle I think think America, don’t we getting anticipate as think Latin about there. East, we the about we anything better

high the definitely growth of through you The gives US the of kind the that will remaining get market better view. So year. part

I point US, have is have sale And we it ASP bigger getting Fluke’s than does think the year. – see at better EMV Western I we we and in necessarily have which US, And rest US anticipate, of is, there in better. don’t European is Matco the business getting whereas the the would the the better much better, Europe that business. with of the I a tailwind getting difference getting

out we second of with Europe, And the ripened a bit little I get begin longer So started part be I thought the when say North remarks, to into more America be in And be COVID. anticipate drawn of recovery. sort to remaining get we sort I but sort would prepared of our particular, proven year. wrong would as long in to Hope as with Western wasn’t the that through the half process that there, of – to tends better mentioned year.

Andy Kaplowitz

Okay.

ask GVR. my on me Let follow-up

half what’s on year, Specifically, have, second mid the just infections, year the in confidence that to of sometimes you basically, to into know you you Does America? growth in America. the of And in in you the a that in talked in doing stay-at-home North maybe so in you delays revenue the does order and mentioned half haven’t terms mean year. then gone they’re it second orders convert there I away, growth does for level better going know, you half international in GVR of guys of the tend that second about as business and convert be we single-digit North tend see they know little India, lumpy better new orders the obviously just

Jim Lico

second was the half. Yeah, around mixed little in think North It’s continued America the I world. a orders be good to

where in market. As world, the world in it and companies the a a oil does are US, oil of parts and you disaggregated gas impact the little number so customers rest know our in of bit that’s some the has of integrated than prices a more

second the of describing relative think some half particular economy. in follows the will think do that those I think still But So India to continue. patterns I was I I

you number there, India very I in we Orpak with very have We, good we’ve acquisition a a think or of customers. acquisition, position have is our acquisitions great know, done good. relationships position, we Matco

a to you confident, it good quarter-to-quarter, as if business really we look the can team continue said, I’m that but there be lumpy built year-on-year-on-year, and will So I’m we confident execute there.

with I to executing East well to other – the be are team day okay. all might I of Middle a the And for So the markets some they’re some did and think, Fortive. think other you going markets be continue we know, review there a

think on better backs little a the you bit So pattern in the likely EMV it’ll I But half order a country. know, strong depend and will, on North continued market GVR, we’ll think, I general, market and know, you second the see in in of America.

Andy Kaplowitz

Jim. Thanks,

Jim Lico

you. Thank

Operator

Capital next Dray line the will of RBC Markets. with from come question Deane The the

Deane Dray

Thank afternoon, you. everyone. Good

Jim Lico

Deane. Hi,

Deane Dray

a more you bit returns you’re that a investments Pioneer hearing this first kind something this It really in launched. kind like you’re got your making expecting? interested us Square Labs. And joint I’m Could for this? getting What you’ve of Hey, than just with sound what does venture sounds R&D? company of remind in about proxy more

Jim Lico

We’ve we’re Yeah, good the them about it. relationship built in team. very really a it’s excited with –

really is, it can different we that want we agree ideas, in, of team, find people couple it, on what if to an generate at milestones where we idea that to Fortive we we have invest we process, know, a decide have the idea in invest lab generation we bring as want the devote, an alongside of we that work a You we number PSL we that it. or you we as And whether do or in conclusion in relationship. not invest out. we good we it are it to at a own draw necessarily point for in continue about the do certain something very I something or time, to to economics and think both obviously know And feel and take want think, you know, I parties good the

very They early cycle a of software lots fast of product lot entrepreneurship, development, days. still experience. bring So great

number you next in they’ve and over been put days, know, that been we’ve a on and know, think wins I years. – one we the the enthusiastic – very we’ll, the very put team few early table. quality talent of you know, brought to But I as we’ll have, that up hopefully to continue said, you of think can we and we’ve level we launched still

Deane Dray

Well spun businesses with other be Fortive. out, synergies core sold these within

Just maybe from company how the of this benefits explain kind overall?

Jim Lico

necessarily idea, great Fortive. And I benefits it we would, it think part way do economics well. know, you can decide that spin Fortive with wants consistent economics ultimately, that that Yeah, if in isn’t it Fortive could with you spin also great would and spin that, that, a above, become. got it to be out to what But it’s the to make and and a bring something we’ve that we associated we but so that to something be be would know, it have and in see really as we idea could a of we the all

So, to something, a ultimately that there we’ll are our mix flexibility maybe necessarily a create find number structure. as different you of ways spinning value in of have ideas zone. there’s to other But also options, to good we utilize of and what what we but different it don’t and know, we’ve kinds I try become, the sort technology, want out ideas obviously, is – Fortive and building if then got with think do a to strike in and in

Deane Dray

you minutes III except this said to just, really set just question, want that And you’re into a a returns. those go But and as Got it? back on start to I where situations that And already. businesses you necessarily IV IV, to it not in And those decisions there four up. businesses businesses there capital looking you’ve you’re those few non-core? of second be in commit I opens that further you’ve M&A question groups and III been up non-core getting Vontier ago, kind higher these groups structure once know Jim some investing announced. opportunities Group that the to have for be exit. saying got you’re considered businesses, But are some might not of might there

Jim Lico

that it things we answer you love – you how, gave is, about no, I meant that I good the one with a I perspective know, what of everybody know, think grouping think Well, of was meant is, when and really and sort how – to our the it COVID dynamics know, parts you and sequencing mirror, the economic perform businesses show of of of of the consequences meant our COVID. resiliency of that would

our III, for really II, together. of really I, you number of and with it’s portions that, are a as So a built businesses framework know, group IV all

as a an good and take like you of is So, II you just II. example, know, Fluke I is chunk know, said Fluke, we in and before, in Group I

becoming that. of a and growing So part increasingly

are more that aspects probably necessarily know, we’re opportunities having our or the of we’ll number words don’t individual finding our higher businesses, businesses within not best I and that’s we’re necessarily what more going think operating find to companies, build in, our businesses invested going know, our a more of investments. it be, growth says the up resilient, end you of our more So those but within where, to probably in is durable, business you to

So good as a example. Fluke is

also we know, PRUFTECHNIK, You bought we bought but Landauer. eMaint, bought we

know, good Fluke been to few has last a into business. in we Fluke add capital years that the we, So deployed core of that you IIs chunk the and Is those to

of some the II Environmental I do, for really III to the in those parts we even you within another have aspects of of know, those because as places we Tech, and those I and parts businesses investing are about and some there Sensing where same Group Group growth that Monitoring IV, can we driving have we’re those are businesses, example, them. that the the think of talked things group opportunities also

Deane Dray

That was you. helpful. Thank

Jim Lico

Thanks, Deane.

Operator

question will John from Suisse. line Walsh Our Credit the with of come next

John Walsh

good evening. Hi,

Jim Lico

Hey, John.

John Walsh

Hey.

any as covered. kind want ground you businesses. there relates retention however to helpful. to rates? versus just might I way answer or ask kind net that about a I best customer thinking discernible negative the question it of be Was about So guess, think of the positive But SaaS the to it’s lot thinking of change adds? across them

Jim Lico

all is our improved really really of businesses SaaS at the we we that in look churning key Yeah, that metric current metric retention in that keeping in metric not quarter. net John and is and the combined – of sort customers, customers

metric on, keep the every important. board eye meeting, an board. with key And a it’s So those we actually metrics we so they’re review

ways lots I some the benchmark, doing still businesses very have are the at So on of them to certainly of feel to improvement get those of team still think we there’s some about them, good go. you And of all work is metrics. some our kind know, in

it’s continued So for as we of a our a FBS those well where tools lot focus businesses. within

John Walsh

and And that a something you back in expect thank then launch launched or platform, to has the new actually that just is you. Telematics point half? clarification around here the Great, maybe of

Jim Lico

and I get think traction. some to starting it’ll now we’re launch now

it, the call you early of know, in So stages launch.

John Walsh

the it pass Appreciate I’ll color. along. you. thank Great,

Jim Lico

right, All thanks, John.

Operator

Our the next line question from Buscaglia with will of come Andrew Berenberg.

Andrew Buscaglia

everything know your Products know that last you kind have saw Fluke over, squeeze but strong guys business. Hey, to you one demand Industrial comment within some for in I picked you Imaging that of I on one wanted the is,

and as of skin you temperature Is can relates you just what on exponential is see demand really You that our of know, you you know, to growth this guys could know, niche outsized some your – strong a growth were more competitors comment and, referencing PI? that in within vertical, that, you it seeing, cameras. an area that know, kind are that’s

Jim Lico

IR business from Temperature Thermal there Imagers - Andrew guns all and the imaging you thermometers. line is know, Imaging principal well it as literally and as so our Yeah, ranges as Measurements Thermal

a relative happen it in And fold So into new entrepreneurial yeah number of do that also business opportunities of the facilities some doing of that working COVID-XX. we’re is that sort has that to well. challenges on

acquisition that we’ve that an excited the years this, people we’re we business few So remarks think we out a broader got a strategy a that building solution counting we’ve we about in here, mentioned prepared is we’re a some little bit had of ago, a that launched. part

we’ve quarters. it’s to coming of really just that resiliency of think beyond and you build So know, try to know, see able the sort a goes and is it number things we how that we we’re in be a, the durability whether we’ll to that here you and got here on build excited and going whether COVID-XX that might

Andrew Buscaglia

got it. guys. Thanks, Okay,

Jim Lico

Andrew. Thanks,

Operator

line with The next from come Inch question John of the will Gordon.

Jim Lico

John. Hey,

Operator

open is – be must line – John, muted your it

John Inch

can you Hello, hear me?

Jim Lico

now. Can

John Inch

Oh, now. you can me hear

Okay, great.

but think you aspects getting comments America up technology, that, that, was industrial are how California about the isn’t you business know, the other just you’ve about Chuck, COVID surging companies. that because, southern states wondering, right? Sorry that that what impact your you impact you know, in other the in better and implication kind superseding and I are you’re given that flaring is Hey, or inferred of from the this, like is forth. about North so of describing to dissimilar from seeing, Is

ground, out? you’re kind kind how of that regionally So of and I’m seeing what just on curious plays

Jim Lico

we or the three call place, the where biggest John, relative hospitals places it, call stuff the see ago, to on to day. a impact customers it’s two described say GVR would Matco I really equipment in places, we biggest sorry, and the ability sterilization is Matco getting little COVID daily equipment the that really maybe and the in or ground procedures while getting the ground, every in

So those businesses are we and US big look as I as think through, well.

So, economic is those of know, Fluke related. related. are you at COVID The stuff point-of-sale, kind really

ability and the to back the point for you not better so see a want so watching IP to probably you You go know surgery lockdown. numbers, what but into is, we’re Fluke, that’s really for numbers global know, PMI, better

point month. you things is resilient accelerated good soon to frankly, bit we today was a call mentioned car as thing that impacted up, Matco. for ever car quite years ownership it’s that little what business, And really know, average I was, would – remarks, open the cycles. a pretty lockdown we relative But back tough normally April a As I of as in to the Matco. to historically a is really which been it economic the think prepared saw highest started

for. Gilbarco say aren’t that, be lockdown mode to can’t think we’re – and back that’s shops close see what I We So into can’t down. back – to want We don’t open where they cities repair or you for hospitals where construction at watching see won’t Gilbarco. don’t – be occur auto get know, sites want upgraded

John Inch

of the again disassociated or or how Yeah, going it two follow-up, now M&A? EBITDA that getting cap back ask the are makes that terms volunteer as then are necessarily sense. And the context of, the the And does dividend just lower from separation in debt Jim, the I I.e., kind contingent this on and on debt maybe somewhat strategically the reload volunteer other? a tracks? is do not thinking to one thresholds to to further you be to contingent about of somewhat and in

Jim Lico

year – think because a been digesting and be we be year a things. last never we’ve well. our we things fairly although sizable you – a looked that’s you always did foremost, number said year at I I more would thesis, that likely And think of bolt-on first bolt-on some Well, know, as this can of

continued day the busy. at be So, the we’ve to you end of know, think I

continues the there be I not this. to things things that alignment sometimes the distinguish the takes market. of talked know think impacting hard quarter necessarily. additional that an of have peers It’s M&A that our a about impact through COVID spreads is with I are in to seller. from some two and still bid-ask couple One are to results work a

it’s get can’t We to people. just harder do can’t diligence, in of right. meet piece second cases, it, on due site The we many

those firepower the together more And when I slower been that so Vontier were you tied that think of But know, continue Vontier never we know, think then fact – we’ve Vontier opportunity, are nature things we we busy, say because the of things it’s transaction, think aspects. but certainly that wouldn’t and opportunity. separation. But there’s us, necessarily really, certainly to I gives those more I it to to certainly complete And the with. by tying two you begin really

John Inch

you By mean say you the bigger when – bigger you do or something than just bolt-on mean bigger, way,

Jim Lico

you means know, a necessarily mean, at were are And some know, Yeah, it it do say, anything, – that haven’t several years. know, you mind, can’t things means no, for going do certain time. bigger. because, hey, cultivating different we, that we’re you to been I you said things we we selling not there we’ve

the you So, when they’re are know, account that. to and going taking responsive we’re all be obviously returns. you to going to sell to conditions might know, economic things have into we the sell things that But, and impact

But we’re not, So complicated – are in words too can our up opportunities. sure many there’s the but at create we end on the being to the day, more it’s a focused bolt-ons hence, way ends than ear a if think do I of maybe that prioritized have probably we value answer, focused, railroad making we other here.

John Inch

complicated it, Appreciate time. it’s

much. very thanks So

Jim Lico

John. Thanks, Yeah.

Operator

Our will Rosenblatt come line the with Graham of final question from Scott Securities.

Scott Graham

my question Hey, good evening. the taking questions. just to two I Thanks on overtime here. wanted for ask

was cost positive that. materially up us than told points side? – was lower on you You price price were XX basis Were that the

Chuck McLaughlin

and good a is Hey, this is Yes short no answer do heck this Scott. job – teams there’s have the every professionals procurement and of and year they our different. a we

Scott Graham

and the Got IV. group second you. the then III And is group one

of second those know, needed, you people which fix, businesses to on and were all the So lockdowns margin the be about bit know, you was doing break little kind a And and higher quarter of sales as heavier. tends type sale.

because was two needed the case, – Or as stuff, mix, headwind second was case just the quarter you maybe quarters wondering, maybe now? which enrich a in the that the of quarter help not I’m particularly sort wondering from in in So PI? that’s that I’m guys for the if just the

Jim Lico

all. at not No,

a know, frankly. the is I tight power what, we our lines. you spread think quite FBS, margin very have in This of look at when really, You know, we product

that price we time said, really the as we has necessarily valued you from at the times, that, brands time to these So don’t distinguish our metric price, you is to know, everyone. high do know, know, that, are time, critical the you with fact for

think right where don’t looking different situation and could point And groups that so across can’t I what one. trying of I and now think might I I’m margin, from to, find I where to the I be think could know, commented a of just you

think obviously is know, more Matco you higher is So more, well, consumables higher you more know, margin, know, I you margin.

obviously, number, margin. high businesses, profit the operating represent are know, there’s So, don’t businesses newer they you but our margin, software of some so necessarily highest the

expansion I suggest as come a – some look certainly margin year the in back So in over we core next so. our that, or think, the might at is businesses respects know, help as you you

Scott Graham

Understood. Nice you. quarter. Thank

Jim Lico

Scott. you, Thank

Chuck McLaughlin

you. Thank

Jim Lico

your quarter, it. I of a Fortive a couldn’t try the are for all strong your of with for just that working I for done. very building us. XX,XXX employees certainly envision the everybody proud done it’s about concludes everyone. We we in We business families you are time Well, the thanks it, over that appreciate what our around of safe going to making virtually. well who’ve incredibly manage job importantly, and so work for I we’ve time the world is challenging hope much just and challenges – I all as enough say we think have work an more going to incredible know come. years but that the

So afterwards. thanks for look we time with everybody’s calls. Thanks, evening. calls great taking a forward available for Obviously us the to have and the

Operator

you call. ask conference you please your for that today’s We and lines. participation your concludes disconnect thank This

Fortive (FTV) 29 Jul 202020 Q2 Earnings call transcript