CR - Earnings call transcript Q4 2017

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

Operator

Good day, everyone and welcome to Crane's Fourth Quarter 2017 Earnings Conference Call. Today's call is being recorded. At this time, I would now like to turn the call over to the Director of Investor Relations, Mr. Jason Feldman. Please go ahead, sir.

Jason Feldman

good and operator you, morning, everyone. Thank our to fourth quarter call. conference release earnings XXXX Welcome Director Relations. of Feldman, Jason I’m Investor On our Maue, call our Officer. President this morning, we Chief Officer; have Executive and Rich our Financial and Chief Max Mitchell,

will after we remarks We few to which off with will our a start prepared questions. respond call

Day the and comments XX-K during report, and and of comparable www.craneco.com March in make would We the filings if like presentation, accompanying Annual conference. our to refer tables to will this reminder at the on section. Investor bottom at pertaining our may using place like Investor release me directly Also the on you annual our contact the which call at and numbers, the earnings website at the statements. available of end forward-looking both of subsequent on reconciled a Just to in our invite the be we include that you the also to I you GAAP reserve Relations cautionary the a on numbers release Please slide to some events statements. language we also of call, morning which some non-GAAP are forward-looking press to our are would attend Xst.

let over the to call me turn Now, Max.

Max Mitchell

are results. finish we pieces a Thank where moving and you, of Jason. are Well forward we exciting a say to fronts. the There in opportunities great year of but what had I can on lot lot really wow, today’s many a moving

entire to story. best do the with understand please us bear So we you our as help

three last to I’m XX% compared we to last On quarter Crane’s margins the items, from full-year excluding outlined X% was special basis, of $X.XX, last exchange increased EPS our million EPS, night, compared X% pleased XXXX. Operating report year. XX.X% to growth records organic a acquisitions. in XX.X% that release year. new $XXX excluding balance of fourth year As in set and foreign press special up and from adjusted items Sales increased last with

excluding XXXX last Special to compared to EPS, record X% $X.XX. First, a Items, high increased year

operating and driving culture increased increased working notwithstanding capital across of our flow record opportunities strong million ahead excellence, still of a outstanding to of I’m extremely performance through reflecting healthy continuously XXXX are our of And have of high businesses. I’m execution end-markets any Second, XX depressed basis margins operational and very record to a high at free XXXX that third, full-year adjusted points during levels. cash we reflecting beyond. XX.X% $XXX our and proud excited in us performance the

are We execute well showing expect end-markets that our business to growth. generally in core modest

expect also the new meaningful we In The greater give is customer Crane needs a move flexibility to and it is us years. accretion demand. rules have able we to and tax repositioning Tax over few be Currency addition, and ensure next we to now Crane. the for Reform substantial to acquisition will improve future for growth. that benefit will and are us closed profitability, meet proactive initiated Further, enable investments needed accelerate it will deploy measures future best where cash our

yesterday also the our first from than reflect growth to reflecting adjusted outlook, time dividend XX% by Impart, we for confidence EPS, potential in since into we account, growth these of to of the before announced our EPS XXXX factors earnings expect $X.XX these further excluding contribute X% raising even we are double-digit all Items $X.XX should midpoint benefits next Taking several together, for the the Special more our at range. deployment. years, factors XXXX. Taken to capital including we believe XXXX from

well. Let our starting core businesses executing Overall, business. are with me pieces, our the of walk you through some

XXXX making Handling new and modestly across products, in I As portfolio. great continued developing operating technology, on Fluid our progress mentioned, markets had we the we new performed efforts introducing adjusted than are pursuing better margin a new record expected.

and quarters levels. a saw Orders the meaningfully third QX sequential quarter. in but As bottomed first we solid have believe second, end-markets previously, discussed in that rose generally with the improvement in and we we were consistent XXXX fourth year-over-year, order

We continue other share about to believe this market half with our already improvement. growth order is gains the underlying that the year half

unclear. a and rates trough meaningfully of levels, still levels a order While improvement pace XXXX are little above is future backlog

We growing driven expect and share gains by modest in slowly. end-markets that XXXX core are growth

recovery rate than of the As is slower cycles. in prior

a business. delivered we slower margins actually last new core since yet adjusted segment Along have great XXXX wide growth markets growth despite a Full-year At XX.X% team Technologies case initiatives and great have we year and MEI Merchandising forward. both acquisition opportunities. the in Overall, introductions than softer in Payment level in for core of product core to we This and market have this markets will are growth this we and out in new we growth, new deliver operationally business, another good on well In X% margins segment followed of margins We creating of the record entering and year. rates X% in growth a return large project. are to some we this very X.X% making are mid-teens roll merchandising doubled. range we nearly good this & job and believe to on in XXXX. from a business, solid initiatives leverage very retail XXXX, on have progress expected done executing adjusted this with moving has of growth on-track of XXXX in

for retail to We accepted value proven become have based for and self-checkout retailers by demand have see solutions. a proposition retail the strength in These as norm broad continue solutions customers.

from face increasingly are numerous As on productivity. focused retailers to They challenges saturation, store e-commerce

in is retail to see fee as solution in used smaller pay We traditional a on self-checkout typically such retail with continuing application business, retail also growth our stores. tower that

high are well. executing Space had and margins project last we programs we strong with position developing At mid modernization In retail, Aerospace XXXX, digitally in expect, is applications those remain single-digit focused well particularly three more Beyond but basis growth we also both improved team where to core a vending following Fence the positioned than very Despite year. cabin very anticipated. end the in core XXX comparisons challenging Electronics, & we extremely rate. at certain XXXX Despite of very on gaming very was XXXX, moderate markets. we along growth of years challenges, markets connected and a have and and commercializing points from further softer challenging of comparison and upgrade this the completion that the

commercial customers engineering remain a generation C-XXX, the the as decade. a business, development XXXX discussed, us next completion technologies, ground max, This into up exciting time next years focus have programs volumes the we microwave following of cycle ensuring NEO, these will freeing previously business a well up to improve. as number is nearing or for of expect this for are major narrow number investment XXX large positioning completed body in across another business shift our of our program a well A-XXX in to aircraft also new E-X as segment next for Turning platforms partner of growth we new It’s large we on continue based for our the resources ramp aircraft this that radar models development sometime critical been growth and to continue. including aircraft in

expect markets benefit growth and to technology operating muted point, execute expectations, X% We core continue growth the materials products further organic we somewhat a seeing with we further XXXX, productivity, we we was the businesses. initiatives. At in our on major and focus leverage. core the resin for RV invest above both levels and market XXXX share costs. business continue growth Overall, to building military numerous in continue best-in-class and business rising gain engineering core new drive are our commercial also by although and to our new is in colors expect competitive opportunities positioned growth in X% technology formulations this where growth in the continued on contributed differentiator. ARV our service to in At Across insertion to and on X% of side well XXXX solid for products the be

our This sophisticated Currency, businesses this January, has Crane’s have currency Crane’s far. Crane’s is so been pleased in very and largest of has that to history an markets. it excellent in seen fit a been it’s great second presence compliment closed to while Currency business differentiated most early in acquisition and with week have Like we Turning we we technology. and proprietary few payment standing on only our the a

to begun leadership roadmap the and run a to said, to-date the are team. improvement we number them and has been improve a develop happy for accelerating ways a areas, already impressed is events with the operations Currency and investments Currency have sites. smoothly very strength We operational business. team, the of are integration working with and we have of Crane That across In with we well Crane on gone prioritizing improvements. site several held have several

of counterfeited. and bank growth operations on-track year, Malta. to This the is encouraged security later Micro-Optic we are multi-layer sophisticated We printing technology Crane begin and continue business Louis this margin structure. be are site this Currency that And is will features Investor Technology, the by to film engineered and improvement. the with thick cost solutions this the discuss enabling we incredibly new underlying successfully which Currency more opportunities Crane improving good utilizing progress innovation impressed note in see Pinkham an industry many facility highly resin-based But for detail on and Day. and with been we growth, have see never opportunities ahead. leader microns in

approximately For are $X.XX XXXX annual accretion with in by with forecast of now, XXXX. our accretion comfortable we $X

annual and benefits tool profitability and to primarily rate include current projects investments and our XXXX new research approximately accelerate XXXX through utilize in we the full the forward good benefit feel $X.XX then on number approximately benefit expect across These several additional the in on benefit about rate help how the primary will product are team of XX%, tax by tax growth tax growth development the new our platforms. $X.XX This growth down initiatives. Tax tax companies, clock of reading our for These with equates from moving tax working using the from we development enacted of and lower to-date base. $X.XX the a immediate assessing work, Moving would report recently of investments We earnings are new XXXX. XXs. investments with to we our to rate the tax investments. share approximately $X.XX effective Reform around per historical Cuts the of from substantial their legislation. been Act, Jobs Based an Tax tax tax low in and an weeks has pleased and many effective that annual last to Like the on our benefits impact very the

Beyond constrains impact, our to In needs flexibility Crane United for steps following to the the we back deployment interest priority deployment capital should of to than easing for payments. repurchases flexibility balancing domestic had domestic we our the however, acquisition. move legislation dividends, cash opportunities term, expect the of the us near-term EPS for Currency the levels have flow more reduce cash have expense, expenses, gives also past. the with substantial corporate Longer States, in debt cash capital with and the more

to Repositioning. Turning

rationalization investment well. acquisition flexibility. those additional the and Tax Handling, activities you Aerospace & know, we off moving more profitability, lines, possible. forward a businesses. constantly all performing to is across we with business as bill Electronics, as help Merchandising and our on core where are and start a are repositioning our productivity and But focused certain Crane us give Currency Company, Reform great fund & is Our Fluid Payment Along The

continuous consolidations relentless for in new businesses. Our focus has on opportunities created improvement these facility

are these to or Importantly, not market conditions this performance. do are being by forced we proactive, actions financial currently

serve we expect in reform contribute XXXX. are our in don’t XXXX a $X we exciting these actions EPS multi-year we rest fully helping improve meet be improving should per contribute ahead, actions proactive we have completed, legislation where executing in by expected refined summary, be that multi-year approximately to XXXX X%. the end core leveraging story our annualized items to starting of we will XXXX. we will growth competitiveness we end situation business of When to position to However, Together, reading our raising year XXXX. better XXXX acquisitions a well, exciting in reactive a better very customers future the Currency that our markets. also in share will to the accelerating our later. an $X.XX time growth time confidence profitability, per this our EPS that by $X.XX an footprint of our per outlook, actions through in off and and and dividend believe by across well contribute run we Crane will up attractive earning an and Tax business incredibly of and ensure protecting requirements. add to investments to EPS In Crane had also growing these Repositioning special approximately it share rate excluding great $X.XX expect our busy It’s outlook. announced to a will earnings amount reflecting start, are also with $X.XX an business but

in right extremely three but are strong we Crane how Company. story much Co. and record heritage many delivered leverage and an primary from technologies decades we our our excellence more a have more commitment footprint, have history we of have platforms Crane the continue to unwavering about Day this a growth of ever with future, foundation. rich track that past, to brighter record initiatives today, as the the of continue our in success right and we to talk history for at has importantly evolved we positioned evolve. innovation ensuring we upcoming focused Investor results, behavior, have operational a are We we ethical ever investing And to engineering and convey as than right on and will and brands, try

over additional now call some Maue, turn to details. me the businesses information you the and who and financial through take Rich provide guidance will Let

Richard Maue

Max. you Thank

fourth very opportunities we mentioned, all about little a ahead. been Max performance. As the very color into more we way excited a busy insights have some is will good the and provide all have on in the team I with and quarter our you

of our X%, $XX I backlog and the compared accompanying about Lock core fourth Fluid West million handling my with reflecting operating provide and $XXX the sales growth On Operating productivity from from by food excluding of compared Handling XXXX XX% at prior volume backlog million comparing $XXX after $XXX XX% at on the X% tables segments, as foreign with compared million the XXXX XX.X%. flat margins be outlined to acquisition. begin, full-year margins sales for some profit sales was and increased at exchange Starting XX% the net otherwise, a special exchange, press items basis, to reflecting XXXX benefit outlook. adjusting adjusting. to X% our at business end After million primarily comments mix. fourth December Handling of with net a delivered negative after slide my Fluid foreign quarter X% to end the of increased additional favorable offset year. XXXX I unless of and the mention unit on Fluid XXXX I’ll increased release, a details Handling, modest performance comments quarter Before will morning presentation our this core benefit growth our in non-GAAP to and

increased Excluding orders compared foreign XXXX. to X% XXXX full-year exchange, in

throughout noted, rate a However, Max on fairly are as run XXXX. orders for consistent basis

carryover through growth West favorable sales Looking small X% with we and expect a in XXXX, from foreign with increase Fluid Handling the of acquisition. an X from a X% core Lock approximate benefit impact % exchange together

investments. good reflecting XX% of expect operating accelerated repositioning roughly We approximately benefits margins leverage by offset growth with

core X% XXXX Payment Segment for expected basis of year X% from profit to approximately exchange. Moving primarily reflected which to fourth margins XX operating growth quarter Core as prior & core extremely reflected foreign X% with $XXX XX.X%. declined challenging on basis million with by Payment increased to $XX points comparisons XXX up down million favorable sales of sales last the of declined full-year points of basis, were offset to decline a core growth On year. Sales compared margins the & flat operating XX%. Merchandizing Technologies. The Merchandising XX.X%. operating

project core we on XXXX, of on but This comparisons XXXX, at X% three following from amount difficult very forecast expect years large to shipments moderate assumes than retail saw a growth approximately last For year. we the strong continued to lower growth.

Crane Currency $XXX in sales. to also contribute We approximately million expect

due estimated declined substantial XX.X%, XX% margin comparisons With We expect the upgrade in growth. years XX% programs. to term to X% but few approximately primarily to million, million by sales military XX.X% X% driven Fence but backlog XXX perspective productivity $XX from a volume end approximately comparisons, from tough largely margins Segment XXXX. up the amortization million of Electronics here basis, strong at after-market end strong over intangible to Crane led modernization solid very by margins we sales Currency Aerospace X% next were Aerospace full-year lower Investor of last and The Day. will well sales & On expect $XXX million sales longer a to margin with and a of the and the last program, XXXX the points to XXXX. XX.X% X% basis we Space declined mix the our was mix. operating difficult related $XXX associated than at to Electronics segment do comparable of & and Space margins compared at outlook for as Fence as improvement after-market declined to on XXXX year sales favorable increased more more discuss OE by $XXX segment offset increased XX% was year. productivity. spares commercial OE

points to year. Material margins core For with in XX.X%. margins prices. Electronics to XXX XX.X% full-year segment XX.X% margins quarter. Engineered resin sales basis million reflecting increased increased & compared prior the XX% higher X% in expect XXXX, basis, On of X% operating X% sales of $XX the we a Aerospace to with growth sales declined at Operating

expect we margins XXXX, growth flat core X% to XXXX. compared For with approximately sales

Turning now detail on to more our guidance.

guidance, Max XXXX increase XX% from range. revised to at Special excluding our an mentioned, the $X.XX Items, of EPS of $X.XX, As of our XXXX is midpoint

assumes X% total million a $X is record very sales investments million of Operating margins approximately growth expected XXXX core of with XX% guidance favorable XX.X% to and offset Core however, growth range approximately accelerate of X% are in decline foreign $X.X from benefit Currency. from first are that modest reflects to from Currency compared forecasted up XX% XXXX. underlying Our of contribution Crane savings or $XXX to approximately billion, a a XX.X% approximately business a in a by and to in the XXXX. repositioning million decline $XX and more strong being improvement than Crane That the exchange. year

positioned guide year. XXXX in While because well of growth be ahead the investments. are profitability. for aren’t of items up million activities and to growth Remember record sales initially dilutive will Crane in both a business it of our long-term is us for margin managing To setting for new lot guiding we Currency only these growth for years margins, and a growth of EPS future are context, XX level and the we that to is the XX% put the of to able the additional some still we next reason are

we operating we view our included margins. reference, business segment materials our and this morning where posted have on in provide your For website sales both of page a a

XX net We count $XX approximately of interest be tax of will expect approximately a an million. effective million, and approximately diluted XX% rate expense share

million. XXXX flow our strong in at expectations and extremely was Our free $XXX cash above

for flow from of expenditures spending repositioning, from currency. levels XXXX be capital and are performance the with along Malta expect at the in take do revert free year decline XXXX in XX% more integration a to $XXX $XXX to capital by midpoint these impact XXXX. are for cash to expected better elevated repositioning we costs $XXX million growth related Overall, to current questions. to with down pleased Total acquisition capital We reflecting in and XXXX. million. the cash of expenditures expect XXXX an and startup of X% and even range XXXX, X.X% we XXXX For sales investments at are ready our to we Operator, we are a approximately planning to normal

Operator

Thank you. Instructions]. [Operator

Kristine Our Bank from first Liwag question America Lynch. Merill with comes of

begin. may You

Kristine Liwag

higher I surprised the moving revenues profit the the morning or I Good margin I have in XX%. to was actions flattish, quarter. grew even in guys. hurt items problems would performance pricing Max Were guess understand in would that special like repositioning the the your the that issues margins. there incremental quarter? I could Handling in are that would thought pieces past any Fluid execution excluding created have have

Richard Maue

its Rich. a Handling Yes, grew perspective. from core X% perspective the at a Kristine in Fluid quarter From we

the quarter. from issue, exchange. the that differently on add foreign exchange a the in hurt the I quarter that actually that bit know participated for think mix you in-between in the part core you was the foreign perhaps on perspective, growth that if you in But leverage just of growth a little business what us the a

So nice the you really valve well. the does. the followed growth leverage doesn’t process saw as as say double-digit as supply quarter some business third And which we for business core it exceptional us, know our distribution same growth in Crane with

valve Our rate. grow exceptional a the business rate time but actually in the we core business process really a quarter, for that where do that’s leverage at see and first low did

in the rate quarter would in the quarter from leverage I Business would to was perspective bit than pulls say Services quarter. or down The which a that be in it business seasonality a point other second the was lower that Valve third the our

nothing think a was pricing from unusual the around perspective think And to cost the is, in businesses to foreign your largely we So the have among exchange way that perspective, mix segment. question. about it it different I just

Kristine Liwag

new and in reduce or in those expected repositioning And thought if a part this return cost? XXXX I second Is your plan XXXX different I previous to by through of question. understanding my in this cost had $X.XX XXXX, previous at can reduction you in a outlook. add of XX% footprint with optimize is From planned initiative the a

Max Mitchell

and with cost. new expected Yes return initiative new

Kristine Liwag

$X.XX? reduction Could you your for that cost provide expected

Richard Maue

not please? I’m question again the following on Kristine, $X.XX

Kristine Liwag

by guys for thought XXXX to So that repositioning. reduce $X.XX in and your XX% has But XXXX. guidance had your XXXX plan cost would through that XXXX repositioning new previously XXXX I you

and So this new I’m $X.XX? that if your is footprint new, is old what this trying in your to expected or see reduction if from

Richard Maue

XXXX From perspective, of we we a we any third, will are costs. year-over-year initiative benefit Yes, think the so initiatives, have these recurring off planned. initiatives, didn’t would from I new I segments of incremental older roughly start part it’s referring you which through that. terms in the new third with complete in a $X.XX if perspective about between the that question, we From Handling From nature amount the of savings XX% think these of benefit Fluid third, with are and that not discussed the that’s just in a other would XXXX on as that least two that seeing among that groups. split but the the segment, point be the period look are XX%, view, I even $X.XX just we way balance call. the through we in may about the of the forward, of to time

Kristine Liwag

very you Thank Great. much.

Max Mitchell

Kristine. Thanks

Operator

you. Thank

question from Liptak Walter next Our comes Global. with Seaport

You may begin.

Walter Liptak

you is net special make a charges? just benefit guys. is number $X.XX EPS. net it as Hi. a I if XXXX benefit, just morning, Good that a said it In follow-on of and as rationalization of is question. a that benefit I to understood sure want One it like to

Richard Maue

see our to will. expected were that benefit the is guidance you the midpoint if of that in So

That at just split last benefit of midpoint the I program a through included within going the or roughly XX%, read Handling So year these answer split is other that’s our balance the mentioned on $X.XX. actions. with as to then were that associated X.XX, associated question if that and included in for next not to Kristine, of $X.XX is $X.XX to guidance in XX% Fluid cost among groups. evenly with Kristine, The this the

Walter Liptak

cost, it And the we throughout the see quarter spread or second to year? going are Okay. for them is

Richard Maue

was We a to release the earnings the It that certain costs in year. night. will throughout here for see you last take with that associated spread charge accrue the fourth program fairly be net in did will released the quarter

$XX piece the for a Company in is might million that program. $XX there about the anticipate entire recorded. or We actually $XX million So to to million, was so another related full-year a be roughly or sorry $XX closer is million,

Walter Liptak

Well great.

the Alright guess business wanted margin payments in for Okay. you can timing I thinking thanks to more us that a next know year about that that. detail the is ask growth talk you to orders you clarity expecting the that what for year, on and about to about throughout and of in rate little bit the get to. you maybe are impacting margin to I guides that

Richard Maue

that is I think to we I facility. Crane expand next Malta about profile incremental quite a say there and Crane impact think Crane results in XXXX acquisition when cost included year Sure is that Walt. up the margin a during relative the for operations in point that the bit or about bit the would that’s of guidance this would But point the you expect gave. reason think I unabsorbed business margin Currency is Crane the covered combination we to XXXX in Currency quite it’s margin remarks for a out expense to next Currency and starting profile of in acquisition. prepared bit reinvestments lower there business of way amortization of year. a in the that perspective, includes of that we growth I also which It’s the with would expense. highlight investments is coupled for Currency had the the intangible the the quite the From amortization What it’s a would out

Walter Liptak

kind accounting in things any you those carving one-time be going of you Are purchase with be out the any would where or quarter? Okay. to first, second

Richard Maue

that Investor provide will us at midst clear completing transparency much Yes, more Clearly try we about imagine Day in and those around right that, figures might numbers. lot we or the we work. you has will everybody the as be are very to that more of ensure

number intangible things that associated for associated other of but amortization integration. assets cost nature other that right will salient like and with there up now most things million be you other the $XX of the think and I is amortization with stepping

Day Investor and and So give that to you. those we for will try pieces more up break guide on at clarity

Walter Liptak

at And P&M order large I P&M a to margins that’s going business know you little about just one. fourth a project the come visibility in is expectations, last for you Okay, bit I down business just the the quarter talk great. you into were specifically down that alluded hoping little in orders can think for? core we And the year. bit the be quarter wonder if year-over-year, were it but the In to does a a kind the of and

Richard Maue

then half back Yes, so maybe second to order the and profile. that question the I I with of will will start go

So us so for continue on that or guidance to lower our it’s that’s rate, here the much retail to quite fantastic solution to delivering there somebody Benefitted to healthy, going its growth benefit associated expect hence for the what a year is associated conversations opportunity a space. next next core - to margin we with reason and the program would with the but down at profit bit where so wonderful XXXX, to see. large different year are the project, in happening a here it’s in retail around nothing the is prior a us relative the program, we relative

we even remarks order in profile the about headwinds the that started vending. a and so prepared some bit of call are As last in to in in little quarter, the some relates we what more to talk quarter the it was seeing Max’s in today business

or where a of that process in about overall, those the it our the didn’t some resetting decisions had core made see And where would cut think and expectations of So are payment merchandizing they customers some way I in is challenging lacking growth XXXX. our our core was growth we business. business year year this are it for CapEx, within larger we

So the good and think in taken that’s into about quarter. we understand the growth down I of we payment, good a pretty next the X% saw context be feel year in about may profile helps bit that it little you

Walter Liptak

Okay, sounds great.

thank the for luck good Okay, you. year,

Richard Maue

Thank you Walt.

Operator

Thank you.

Karas Damian from question with next UBS. Our

You begin. may

Damian Karas

Hi. everyone. Good morning,

I color quite to book So for any reflect year strong the in just like rate guidance organic what the could around that order you XXXX? the out possibly and momentum if number starting quarter. the growth Fluids, a X% you provide the your conservative see year seeing finished here, seems in in was given wondering are kind you are of closing it could be

Richard Maue

the Yes, or I question. point understand the

the to to I exiting in coming think into sequential the that the and order then saw this look look to XXXX of way profile of at is XXXX, each quarters the up orders we at rates today.

If saw relatively QX, back, and it’s really quarter we relatively QX, first it’s you big to it’s XXXX. picture flat, order the first first look the in quarter profile been however, the in very been flat, step a up comparing okay, QX, favorably since

our in next we see that see for comps like the consider are estimate XXXX way think year, year-over-year benefit simplest it. don’t you guidance we XXXX, of on putting the in is So I in

Max Mitchell

of so they be add stage seeing while so would many that project in be about what seen haven’t where we to conservative a that we new some stage they the Damian, point there this a little we around the terms quite we activity we whatever years. a activity about No matter for orders about for up be, projects that’s as those think what any question seems have seem better about tracking MRO projects inflection distribution feel bit. in been and may picking activity We picking encouraging. up And bit are to be bit, orders I yet, in, little may forecast better XXXX end-markets. certainly in little feel

we significant don’t There to be So a is believe inflection point. going

continue we be we any I Handling very slow dialed will have well. pretty little think Fluid being type to in risk we think it’s going to of softening, steady, execute, of got

Damian Karas

on and product R&D are just investments? years here. of any wondering on focus you I if be the additional you growth helpful the couple and EPS the you that’s quantified targeting of color provide impact your could sort where mentioned may Okay, was development, these of offering you next accelerated product or investments areas

Max Mitchell

We roughly Payment have of to that & on shareholders go in have we in I decide decision short-term Tax looked things hold those focused made another of very potential with just Technologies from to that are Electronics, we initiatives terms there our year. to allocated XX% any And Aerospace prioritization a every what continue that to list initiatives the decided defer, with year long-term strategic and going we for do the very and affordability very & are coming and Merchandising stay our Jobs hearing opportunity a Fluid that have always In we back to that we at hold in making we businesses. XX% that Cut we & Payment Act strategic have of the things process of those close consistent sure Handling. think and to versus we business, calls large on, out is XX% we versus have planning to quarter-to-quarter and

pricing customer is we it some customer engineering, three what at its we would upgrade a lower or you to us are opportunities I of split start from the it customer Electronics, said customer & kind the we segments. Aerospace affordability typically So this that there can engineering it modernization with with gone there some normally If and case opportunities upfront this an a ask bidding expense and in for is fund that standpoint XX/XX/XX this is is does across of fund. The a are we engineering mean lot business funded always discussion, in either good return fund it’s question fund, good, here to have in so it’s and be we going are and They win And a really fund but are it’s fund a good later. if a price. where they on pricing I would always we reflected believe and investments, really the opportunities in we it’s model. want higher to later and U.S. we looking price

example So some aerospace, of technology. and MNU that’s an

payment [NPD] combination the innovations side, initiatives. accelerating On it’s of a (Ph) existing

product initiatives want of a it’s will we one product a pull product, then in our technology again new some resources assembly new localization to Day, some with on it’s control So developing do initiative market new Saudi solutions new existing in connected West little of the late and by a but Its more and also outside on the Lock cloud combination we Handling, one Arabia. a have U.S. decision a from accelerating in a the of some color additional within particular accelerating space Investor provide market at we in on to the connectivity - development stage side expansion some the have. standpoint. growth introduction In new in Fluid

investments to that some a a through that little start So combination sets XXXX. nice really through us of growth and read this Hope to even of as bit. as up helps for read soon even further will

Damian Karas

helpful that very gentlemen. great, Thanks color. know I Yes,

Max Mitchell

you. Thank

Operator

you. Thank

Nathan Jones Our Stifel. next question from with comes

begin. You may

Adam Walsh

good service Engineered With domestic following morning the is I and on of cash change way views this hone Nathan. think Company the the Hi think does foreign Engineered was and a helps in I for liability. [indiscernible] Adam how repatriation, [indiscernible] business. service Materials Materials business this change of that which in source access deem help the the

Richard Maue

Yes, Adam. you changes nothing know

like we existing the we businesses we that think I the portfolio, in. are like

in the We business bolt-on, strategic a I have no are we it fact new new matter continue a fact other of said Materials that investments focus focusing Engineered segments, on point as before for to is additional we products. three but would formulations,

complete that our a existing a improvements, undertaking driven of quite further an drive facility facilities efficiencies are of an industry at initiative and X.X will We process types improvement. to controls strategic one

our treating though good said Board continue not Having I’m of as pleased questioning continue pretty and are we feel our to cash we direction forward. we to the certainly portfolio as at that, the activist discussion that can will growth. own strategy very I shareholder investor continue move shareholders will So proud of assure maximize constantly a investor and we I to we level value and act

Adam Walsh

upgrade to Alright, similar like B-XX Defense. the that’s on in and Do cycle? visibility have upgrades helpful line monetization you then dome and to or turning the sight of scale and cycle just Aerospace upgrade of any larger

Max Mitchell

number nothing a about across opportunities insertion But produces things no is landing, chasing, pretty I mean is exciting of and have. as that. scavenge that we I’m technology we sensing large like chasing, of lot sensing, are opportunities a excited lube one are There in the we fluid, pump

smaller engine there. We say opportunities are major large I we are work initiatives, A of that on agree? lot Power upgrade. wouldn’t some conversion advanced chasing. program you developments Do any

Richard Maue

a composition. Yes. that’s think fair I Yes,

Adam Walsh

question. my taking for Thanks Alright.

Operator

you. Thank

with next comes Pokrzywinski Our from Wolfe question Josh Research.

may begin. You

Breindy Goldring

Hi, to this wanted back Goldring is guide. Handling Fluid get Josh. Breindy I on Good for morning. to

mid for comp growth high So about this to getting year how that other But guide a by a single-digit of with non-oil. getting we better in Canada the think industries in business? oil there process of internally was we the strength offset year? should should non-resi portions in more tough better, spending next markets prices and about lot process in think in

Richard Maue

necessarily. not No,

and of nature. exposure may I gas growth, directly think could and Crane have is our We kind and be first to be - say the oil some at oil I the that space don’t would different process versus that in gas right. you others of seeing pumps where of things much that

where price are So is. the of support that to where in we flow of impact relative not oil would the loop kind

on I start would with in of that the terms earlier Fluid which we we building business sequential have we respect activity, from we words, perspective part I what that in QX Handling, then like the other a think feel pretty the significantly to QX. follows of profile and growth Max’s process I From us to QX momentum. half sort through specific that. then saw. in change order going is to So with In valve the saw some had consistency step And about commentary particular up of that’s that of give comments

there On that tough the I bit headwinds a is businesses, other at of little it comp wouldn’t way. maybe that look

to its from XXXX with I think year-over-year again XXXX. comps those arrived

a but the level the rest see well the those in terms as I well. profile We basis core a think supports the we demand X% business in as on of the businesses of for at are that in

Breindy Goldring

we through to That’s $XXX walk get help Crane helpful. Okay. million Currency. Can accretion then you the me in very Thank And sales? How just you. the on number? $X.XX

Richard Maue

Sure.

that was So $X.XX the impact When disclosed $XXX what The I had of when we what business. away million we revenues is in million, a from business to to business $X.XX had disclosed or what adjust we of million back the to from difference in of alone at have you think XXXX. look previously the the the December. early roughly this has for profile us business revenue first size just and of about -- it was talked deduct $XXX impact about the the you down impact the that that $XXX balance EBITDA

$XXX get value you to pulled it that’s in the if $XX million. the to roughly incremental a inherent interest and you amortization with would the and a to value call an around depreciation the and rate income started comparable expense, million of with tax EBITDA amortization $XX basically in million particular I So then way expense net business

I in business. I get of of So $X.XX by XX number A little $X.XX is the walk the from bit lot for other are of but terms pieces can detail you at overall a that in moving lot contribution understand There mentioned to components. another of a offset you net with then a that XX that here, that, million we and expense biggest in interest top-line. a the time, more through lot the that DNA, those perhaps lost difference then $XXX a but

Breindy Goldring

And how much of growth to are the Currency Crane attributable alone? investments

Richard Maue

to that reinvestments are to Jobs and Reinvestments, but in Act. is the attributed that that Cuts Tax are business, not other the it’s There we investments connected none making zero.

Breindy Goldring

Okay. Thank you.

Max Mitchell

you. Thank

Operator

Thank you.

next Barry Robert Susquehanna. with comes question from Our

may You begin.

Robert Barry

that Crane guys is in Currency changing just morning. happened Hey Actually the quick follow-up there. did what a tax P&L What reform? good rate or with you given say tax

Richard Maue

of it’s modest impact, Its a at the a most. probably pennies modest, it’s couple

Robert Barry

it. Got

generally or is little through are to a bit know three one aero, two a five. the expectation I about of chat Just you kind cycle

what I adding think the to award three is XXXX. microwave what in two maybe

macro award. is holding that the there kind of what growth So back underlying

Richard Maue

about is Yes, half in and we so about Max mentioned guide previously. the on you X% so his talked remarks pretty program that which microwave that prepared hit the actually close from

that next it hit us comparisons again OE we as know growth next still ramp the even up year by XXXX. as but driven there isle decent expect, You some see might MNU will commercial single to year do some pertains you are

that bit some it’s us good a will don’t Investor business balance from basically a jet, heck still growth arrive that’s and I think We a see whole at we of little color OE guys a see not at we for but and to so of X.X. you Day, commercial provide how more we Rob mover lot big

Max Mitchell

slight you I some level. that said Having the in are here signs some that have could that know think of Handling building Fluid There momentum kind is right be might I A&E at positive. think we while that here

good. it feels So

Robert Barry

it. just basis you of Anything year. mentioned Got this pieces keep to as of lots seasonality on in an this on moving of adjusted And kind earnings year earnings. about but of mind

Is year. like XQ is historically XX% been the that XX% think I year? of a for to hold this

Richard Maue

example year look here, base to question. for think better the prior unfolding. a talked we That’s just I we it on that bit as higher than we plan and have our was roughly think it’s going last see actual at our I earnings, that a good be XX%. about It’s our underlying in EPS business lot but in you know if that It’s not one business, a QX little years, was a

year. appropriate will Investor continuing the the a of parses at as in how in of we you on more Rob $X.XX work that business. detail level imagine as closer bit lot - quarters We as do regard out regard through and Crane get a And are detail might this provide that Currency Day quite that to we the well, to

Robert Barry

Got it.

assume currency just we the $X.XX the should now, rata pro for So of for from is year? kind

Richard Maue

equation. good a that’s Yes, I think

Robert Barry

okay. Yes, Great, thank you.

Richard Maue

welcome. You are

Operator

follow-up question next Seaport is And Global. Instructions]. from [Operator Walter Liptak a with

begin. may You

Walter Liptak

Thank you, guys.

in makes with & just are for sort The their productivity, your self-checkouts you on wonder retail still you what I make competition. investments? follow and Tax labor from you rising comment productivity, them Reform up are called the could to if sense self-checkout. out that capital quick the a which Payment may all stronger, they into investments U.S. customers, to make hearing wages Merchandising, just looking some retailers be at of Now are about willing free for

Max Mitchell

increased into clearly before one But retail, willingness our I think on question that Act be more yet the there to absolutely invest. at Investor and color Tax from give great Act Tax an a we is the anything Day. I dialed or may that’s customers, some hear don’t related there even to

from have clear that the heard yes. customers, loud So we and

Walter Liptak

Okay, great. Thank you.

Max Mitchell

Walt. Thanks, Yes.

Operator

and session. to like I to now Max you remarks. this for over the Thank call concludes back turn Mitchell question-and-answer would the closing

Max Mitchell

Thank story an It’s you, operator, Crane close I XXXX. to strong multi-year earnings XXXX. an start exciting We had has to appreciate ahead. a exciting it.

and a Our off core executing well Crane is business improving in markets. great is leveraging Currency acquisition start. to

EPS Repositioning several of investments year contribute outlook expect by flexibility per it $X.XX $X reflect business our should in are announce to Tax that growth a this, our deployment years. XXXX. substantial share legislation And actions X% fully another over XXXX. $X.XX for by And across we will through will accelerating XXXX. on starting we read in we to add will confidence We to share top capital in per in have Reform And contribute the our XXXX. next all the per dividend.

market at an you Xst Thank a earnings and our informative Keith XXXXs an here to conditions. an on will busy providing It’s As Have City hope New discussion the outlook. in a forward a come all attractive get see all. event as also time Cassidy late singing Investor but day. where The of Partridge look York We and great at multi-year you great on you an “hello David with his Crane smash is sang our role the Family, in song in that Day March we're exciting happy.” current we hit businesses to update growth world series Partridge time

Operator

you Ladies Have a wonderful for your concludes participation. and today’s this gentlemen, Thank day. conference.

Crane NXT (CXT) 30 Jan 182017 Q4 Earnings call transcript