Earnings call transcript Q1 2023

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Operator

Good morning, and welcome to Dover's First Quarter 2023 Earnings Conference Call.

Speaking today are Richard J. Tobin, President and Chief Executive Officer; Brad Cerepak, Senior Vice President and Chief Financial Officer; and Jack Dickens, Senior Director of Investor Relations.

After the speaker's remarks, there will be a question-and-answer period. [Operator Instructions] As a reminder, ladies and gentlemen, this conference call is being recorded, and your participation implies consent to our recording of this call.

agree terms, not this disconnect do time. you with please these at If

would turn like to you. now Thank I to Dickens, go Mr. please the ahead, sir. Jack over call

Jack Dickens

you XX Good of will everyone, audio Todd. the of will through webcast our call days. be available this our a May you, Thank XX version and thank and call. for morning, An on website for be archived joining replay link

in included investor Dover on and information adjusted presentation provides which supplement and GAAP materials, are non-GAAP and between our reconciliations measures website. our are available

Our assume current which a uncertainties, comments differ obligation forward-looking our no number and today from will Actual could We and risks are include to forward-looking update discussed statements based events to of statements. expectations. in on those our due statements filings. results SEC

With the will over Rich. turn to that, I call

Richard Tobin

Jack. Good morning, Thanks, everybody.

highlights The with Slide start was Let's on performance overall. solid the X. quarter

start allowed the reducing We performance with our pleased production to the of end inventory which the our quarter. are year begin to balances very us towards

in production X%, backlog. pre-pandemic supply our chain constraints was more gradual recent of secular our the of driven Consolidated elevated we times improved businesses organic majority most a across reduction by with have dissipated, tailwinds This shipping largely returning patterns, and to The of has order lead resulting at levels. normalized to led Day. growth our largely volumes Investor and that outlined most input growth revenue up

out five one. New order in of book-to-bill intake segments posting with was quarter of robust the four

of normal first visibility with levels remains sequentially order compared increased for the to backlog good the in our us and year. bookings New the remainder quarter, providing elevated

put from customer, volume XXXX we backlog from quarter, under and review. was retail de-booked a refrigeration timing our plan capital During of some single the the

the the Our volume expectation half. that be second in rebooking we'll is

prior segments productivity the period was over positive price/cost with points, five improving broad-based and by Margin dynamics four gains, cost containment out our actions. performance in driven strong margins investments basis and of quarter XXX

during earnings later. from FX We inorganic half. Higher progressively and costs, our the headwinds set activity Interest the quarter EPS of at review comparable rates cost Brad balance FX turns expense, current are the into a back costs segment growth. drop transitory to will interest drove for tailwind performance year and tax. in had comparable some higher the

which off, December Our in are & in paying Witte recent Pumps a several last productivity expectations. process in businesses. expansions of segment, and our acquisition are the is growth of performing and completed investments projects off start year our in in and we automation capacity secular to above completing The Solutions Process we is great

Our pursue capital strong return healthy allows bolt-on to acquisitions pipeline to position a to and our us opportunistically attractive shareholders. of financial

We by in performance and the are encouraged XXXX. so far trends

for watchful but constructive a of the outlook also year. have We remainder the

attractive in conditions remain markets and are demand our our Overall, solid bookings industrial healthy.

Our our order visibility backlogs, businesses our provide longer-cycle to especially good in forecast.

our our We inventory year with to liquidate track we of target as flow the normalization are on concert backlog. cash deliver in full

to we macro understand mix We staying are economic to plans. mindful customers our backdrop, their the close and to of are

X. per growth us cost year full maintain should We X% available our that, With $X.XX to X% that guidance, to have I'll and to control environments. share. we XXXX skip results of flexibility operational organic macroeconomic good various adjusted enable in levers revenue EPS $X.XX deliver and Slide

to on segments. move Let's the

waste impacted strong the out handling positive availability services. quarter, digital driven for X% of Products the handling related have pricing, parts that demand equipment the by The issues was pandemic coming business organically Engineered improved. in up chassis waste and

and against positive to points strong we XXX Margins as available, productivity driven chains, year-over-year, initiatives. dynamics, improving investments increase meaningfully extent well continues the supply to are as basis by shipments primarily mix were that, supply that positioned And demand. be underlying in to well price up cost

Clean fuel and EMV the is Energy in retail vehicle second quarter and up Revenue last comp clean in demand. reader fueling, on volume. of below-ground organic is energy EMV wash, Fueling card upcoming components, decline declined expected and transport dispenser comparable The by an offset basis. X% by the material

We cost taken for full points XXX and in healthy. retail remain quarter year activity business. margins structure comparable as the previously March as price constructive cost fueling positive order improved on was in well were business the the mix as reduction up Despite the actions volume, from cost lower announced basis the in on

spare marking posted Imaging our and ID quarter, broad-based coding consumables. solid printers, parts a X% and up strength in and organically on

to Our large negative business at pricing a actions base segment headwind revenue. and dollar ID new to profits non-U.S. XX%, were Imaging revenue strong absolute a and basis accounts. conversion, this win well that in drove of mix. perform continues very volume, software serialization Margins XXX FX points and on remained improving in and

post-COVID the space. Pumps the X% driven Solutions biopharma in & transition Process quarter, the by declined in principally organically

quarter the then sequentially biopharma impacts headwinds inventory year. in destocking current the New At half positively to to expect of orders during one second as grew inflect have quarter for more of begin we the the subside. from trajectory, the

year thermal other segment in equipment. Operating down to mix particular connectors was this against comparable and quarter the businesses with posted higher the effect peak strength in prior components, solid the the during precision non-biopharma All due industrial margin from polymer in growth organic quarter a pumps, processing revenue.

and the organic heat sustainability. Climate exchangers years, Technologies by growth. its from remain growth and COX robust in last and particularly Sustainable posting investments refrigeration driven trajectory line Top in XX% two continued trends systems, Demand global double-digit

products backlog. deliveries shipping on the strong Beverage up price/cost year-over-year in at of points strong basis volume positive its in productivity, good delivered. and conversion, mix can continued XXX quarter, making Margins XX% against came

pass I'll Brad it here. to

Brad Cerepak

Thanks. Good morning, everyone.

both by $XX five organic the growth go in contributed and the top quarter. EPS our Slide FX revenue of in Acquisitions million Let's three growth of at line driven translation impact was in to resulted the X.X% The quarter. negative X. headwinds our impacted FX increases $XX a and to bridge shows and substantial of segments. profitability. million X%, in top revenue $X.XX headwind or

comps as year the negative and progresses year the FX half the against prevailing of forecasted half. we $X.XX first of for to impact today's headwinds favorability At easier with FX $X.XX rates, second in expect roughly subside of the these

our comparable was From the U.S., organically up X%, a largest in X% respectively, Europe flat perspective, down market, were of and geographic the Asia on quarter. timing, and shipments.

expect We full for in both organic growth the regions year.

expansion of were year-over-year lead bookings pause related $XX to million decision to chart, bottom down the major customer's across store a refrigeration businesses de-booking foreign times and temporarily translation, retail several its currency On normalization order a due to program. new

Slide flow to move cash X. let's on Now

quarter year-over-year. or million first revenue. up of for represents Free the in flow came $XXX million This quarter cash cash $XXX at over was flow free and X% record a

is our year to quarter The in historically due first support of lowest flow investments ahead. seasonality working capital cash quarter in the growth to

actively supply -- our XXXX have improving, results chains to materialize. see to are been working our chains capital previously, supply working balances in the we with discussed As liquidate and we beginning

capital We particularly year and the and reduce expect flow. working driver our a year-over-year over to inventories to cash balance of significant balances our be of the

acquisitions, pay quarters. balances should from several the impacts materially paper any down next commercial Excluding we over

of $XX million second result, expect we half the decline between the year. to would a half first expense As by interest and

on XXXX free XX% Our between remains for revenue. cash forecast and flow of for track XX%

Rich. back to it turn I'll

Richard Tobin

All right.

to Slide X. go Let's

segment and our in we for XXXX Here, summary the growth margin bookings few current underpinned segments. trends. a I I'll by that outlook the comments are jump by backlog before into show make

primarily in by First, our long the are experience a in our cycle -- driven good backlog growth levels largely normalized there chart or a portfolio. nature supply-demand across are times operating are of that a the secular where both. lead or have experiencing businesses We highlighted handful is deficit either

in a businesses book-to-bill indicator to to would in most strong backlogs. our one repaired not was an quarter targets, supply which rationale every orderly into our above require aforementioned order order the first removed year for quarter for for were that in full the customers Next, chains, fashion the normalize across revenue require expectation Order us do positive rates advance. to the which the do is going not due year because rates -- which

as refuse We availability expect remain Products in as by solid, chassis Engineered demand vehicles. improved in pricing well pent-up carryover growth collection to driven and

in conditions two years is aftermarket excellent we remain of volume expect following growth, which automation and constructive defense, vehicle trading to and expect We industrial to aerospace be stable.

solid tailwinds. Products and aboveground except EMV of on here set solid the improve XXXX investments volumes the our Engineered demand business rates mix sentiment dispenser all dispensers, should digits improvement from recent Energy from single businesses low point in booking negative Clean last taking quarter margins to cost productivity being capital with benefits fueling the customer QX price grow in in are to and organically, positive and hold impact. constructive and

fueling be improvement absolute mix, margin Energy restructuring recovery, fade. expect weighted revenue we and proactive we and as expect half entirely in second For actions segment the year, Fueling to growth volume comps Clean EMV this volume aboveground for and improved in earnings

our its after and wins. consumables and trajectory remain segment. is professional see outlook Imaging services to and year ID printers, is Full growth should through offerings attractive for demand the strong margins our year. customer robust this mid-single-digit also software for expected We the some continue for recent

Witte the levels Process strength polymers record project provides acquisition Pumps deliver We in our pumps, in for much-needed U.S. strong to business the growth China, Solutions. to in flat activity continues Quoting backlog Pumps & and MOD the the organic year and particular plastics remains industrial capacity in against business. with

capture. well bearings a Demand and as mix carbon the transition grow rates notable markets, in into Thermal hydrogen, robust double for order with compressor remains continues digits. connector to such engineered energy and components LNG towards

to the the In expect and at improve. as continue second biopharma, second to rates conditions in return order half year remain the we of growth the quarter in business current to

Analyst components drug during for for biological tailwinds single-use are As we discussed the robust. the manufacturing Day, long-term

margin is this Our target full approximately year for XX%. segment

and as sustainability The solid against is technologies businesses outlook levels. climate ship strong for growth to backlog continue our

exchanges double-digit are both natural heat continued We refrigerant growth in systems for and pumps. heat forecasting

fixed remain business. aforementioned but constructive of on margin the our We expect journey some headwinds to cost demand in we debooking the second cases for refrigeration absorption, continue multiyear expect impacting due and the improvement overall to quarter

making can interesting booked the we next is have for some the very and quarters, Beverage in pipeline. several opportunities

We mix. margin productivity on gains XXXX expect conversion, in and continued volume improvement

Slide Go X. to

sustain our range show expansion status products allow the of competitive our advantages some us marketplaces. that and to we Here, our of important in new-to-market projects the of

We are these on launches. creation very opportunity the new long-term product bullish for value

or and hygienic You'll sustainability, of these see touch each biopharma products digitization applications.

behind expansion progressing and growth our projects businesses. Each in digits. applications of Our whether growing systems double heat are capacity well, refrigerant natural exchangers, are biopharma these or

important Over the long term, drivers these organic underappreciated will of growth our be story.

segment within announced the previously model. business this track is restructuring transform retail fueling we on Our as

other across footprint some actions projects incremental first quarter, in operating we fueling as the retail took well. in companies several also have Europe We restructuring in and ongoing

up wrap growth perspective, which a portfolio industrial we XX. of Let's market believe are of of secular diversification with on niche tailwinds. a product range market and from middle franchises consists exposure Slide Dover's significant end many

Our complicated, operations supply chains are not and getting are lean leaner. manufacturing and overly our

together initiatives full will and center-led We regardless deliver. believe macroeconomic our operating model continue to to for have we the available competitive range end of diverse flexible believe advantage our of value-added we cost exposure us with levers that for ensure a market environment. of year a forecast and We line our sight be

year With that, so XXXX that, full our we maintaining guidance. with -- are

So go Q&A. to Jack, let's

Operator

from Jeff first Vertical Partners. Our Research with comes question Instructions] [Operator Sprague

Jeff Sprague

that just on comes pointed pipeline normalize, morning. and Carrier's seeing wonder in this refrigeration business, wonder on I the Rich, M&A the XXXX are inventories in these comment cash pretty your on if actionable as which just interest the out, potential And view? [indiscernible] you quickly. us in you're what through, side you'd get of equation also are the in things there you delever Brad if

Richard Tobin

days one I'll think take would a space space. total I Any second in activity see at say I I that. the is know, it's early what no, think happens in it the to first. the interesting. purchase, I'll in but just I that's leave

around M&A, inorganic took QX cost activity. of some In we in yes, terms

can get we're we across things that's So, to coming line. for guess we I can some an the a tell to indication not the lot you, on that overall, there's that all understand. I working market hope reasons

markets public participation But the or with the of helpful. lack is PE good that are competitiveness the news multiples now converged is and

So on got I we're think the what more in that we with to come, pleased pipeline. going but

Jeff Sprague

later stores is you mean, debooking, this wavering other any you it then this retailers on truly you one-off? on new think expect signs are to I And point or that a seeing year. do said just rebook just some you in the remodeling are actually And either or at I think

Richard Tobin

one a customer of basically intent particular Yes. was their revisiting is. This more strategically what

our So customer. it's

six we a in that just backlog, expect we take and it inventory between back. -- of in but We somewhere have that can problem could just to the then at wasn't left in process. here process It kicked and go point, our months, planning it four terms to becomes

So took we're debook is I it to hearing -- just now, the decision of from what -- clients having trouble build. they're hearing getting to what cost labor. just made their mean, still we backlog, our builds, the with do we to They're it is, just the I'm right a out but they'd continue again, inflation still the the like of unhappy one-off. doing

on opposed market. strategic demand the just the is still is overall strong. commentary kind issue as a So an This one to of

Operator

you. Thank

question Our Tusa from JPMorgan. next Steve comes with

Steve Tusa

think see in made you over into in place refrigeration how about is like of some business. expect what relatively I little of just the the It comments are I XX-Q some on account maybe you we growth the the sequential have but then Is trend know seems that the all to days, in Can rates. kind everything these quarter? -- the there. about comps the color the roughly take you we quarter? think a just stable, the organic but talk to second in debooking the here growth second about organic should

Richard Tobin

that I some product Yes. think QX. would of I expected mean to build in that we have

the for So, remaining bio of quite of there. EMV. But a QX bit that's and a is the frankly, bigger quarter headwind issue last

but better be, all the about back comp and forward of a of point to below going extent, a the the positive. line lack because roll really to bottom the like the that, of for always from is QX it QX sort certain a actually view, me, we of to feel a of charges, comps year So word, roll call good half

a So lot relative yes, QX look comp. to like I mean, QX should comp

Steve Tusa

do on and just Relative comp, step the basis? assuming up we comp I like mean but quarter-to-quarter cancellation? to are we I seasonality EPS mean, just you absolute should -- normal absolute usually normally an subtract take door

Richard Tobin

I up is, in terms QX cancellation. No, on in too bit at of headwind trying you of wouldn't There's to QX What hung is QX QX, math to look a the to similar I a is It saying up QX mean, the monetize comp. there. get a if on door to in going QX. be I'm step volume

Brad Cerepak

Yes.

we not would the I half applicable this historical little second So, first to It's the at before, a half more stage. is say bit said to back half as Steve.

Steve Tusa

you've on Okay. numbers? been guys on there you Rich, That And Any What year? cost. just sense. makes seeing the among -- price then, are update sorry, those for

Richard Tobin

action. to system. not think yes, already any think mean, areas, certain but really I in get I to more I continue meaningful happy mean, we're price we're taking just I the into I think baked what's

Steve Tusa

Okay.

So you're positive, basis? cost though, on spread a price

Richard Tobin

to is full positive mean, Yes, the our expectation I be year. for

Operator

Thank you.

Our from Citigroup. Andy comes with Kaplowitz next question

Andy Kaplowitz

If over about orders, in the love to much you Rich, X for numbers reversal number, order discussed was but order so, last on quarter. an we and your talking in let's the pace you're closer billion climate, know $X book-to-bill in how exclude we I QX, do that.

order you times mostly think said I have normalized. that lead already

you at So to point, the book-to-bill backlog this remain not least sort healthier looking likely year than is it that previously go may more normalized that this of at and you'll more back thought?

Richard Tobin

in interestingly, Orders QX just little had than to it better was all And of were March. we boy. a Oh, it, give in color modeled.

so in to expect healthy. the very size was far track. that to in be So of thought the March backlog but non one below because tracking the need just would was we was it advance, going order way and of it the it QX to We

full days. I need above keeps great year like So of don't the it's in that's said early for forecast, pace the before for that up, If our numbers. our volume to hit we every quarter the one year but balance to be comments,

days. early it's So,

with little the pleased that than better expected. of it's overall, because think QX I we're bit book-to-bill a

up orders greater numerator a you almost and QX have shipment denominator above QX, right? from you of recall, need there. inflection but side, to one So remember on we Remember, stay and to the step

So, QX but in take how [indiscernible]. will better-than-expected it goes, we'll see book-to-bill

Andy Kaplowitz

maybe Yes, the Even you very just again, coverage. on backlog that's helpful, obviously with debooking. Rich. And still CST, high then have

when I QX think COX And the the is go even additions the growth more So about growth a you're growth you systems? you've you mid-single-digit minimum forward, issue. you forecasting difficult? as strength got business, and exchangers a if conditions is in capacity at durable know and look economic given heat get the little how that of mid-single-digit more sort of still But the really

Richard Tobin

we're on is exchanger prospective the systems and expanding heat on Well, capacity. which reason very the side, that COX we're the

basically that we still some of the that is our in capacity place March So we was the terms online. capacity versus could year the think balance going capacity probably to competitors to if our progressively there. build it of of We sell take in in but come that now,

we were would it of fast that expected in a that the talked the do and variety sacrifice can, able positive have to some I some the interesting about it that, in The beginning So, online think in to we're book as there's as you at a projects cycle can't but growth. Belvac, we would QX, Belvac factor which get down which to we year. bringing done. back-end swing in mentioned to terms that we If of as be other you comments, need will things I we be, of quality,

cost the structure past. it's we refrigeration much the tell than rebook been flexible year. I of to the more in the But is the of that half you business that the end day, And expect look, business second in at will that, of

terms there, of to historically. if we're dilution line miss So we have in going don't seen think to I top margin you bit the growth even see the a that were would that little

Operator

you. Thank

Goldman Our comes next Sachs. with Ritchie question from Joe

Joe Ritchie

maybe on following orders. price positively Andy's question up on I So just in order first question, what's standpoint? the guess, March from Rich, an

Richard Tobin

good. I to surprise, inflect that to wouldn't mean, we the we exchangers, basically the I I really get of of dispensers, backlog. wanted if a been think until that Heat terms positive year. could balance we orders expecting and of -- now, American think back we North not were the in was That's half book the go year the

of I anybody some ID, Printing performance think an business good rate at that's you don't growth I models X% there that the if a look mean excellent. has QX margins. really been at

in So, I broad-based it's mean the portfolio.

I I think pleased customers what right? of inflected, that now the guess, we're is with, our biopharma earnings we reporting most -- their you week. Because see

We front in were three quarters kind everybody in else of of destocking. the

feel in a we've would then, the expect more I precursor, And that about we year. I guess, think feel estimates. I think good a if are year about orders positive market March the this basically view, our on inflecting and of half retail full had think, So, fueling the we I second good

Joe Ritchie

great. biopharma, in be flat segment margins into to year. a you're a trough good for expecting year-over-year the the that's year last pretty So, versus I the No, seems much margin And right? XQ, segue it it's like at probably for you're Awesome. think still

do pretty here. that cadence you significant So improvement improvement imply that about the quarters? would think the of How coming over a from

Richard Tobin

QX of margin gross margins. you the half. is reflects from actually Well, lost lost positively pretty we interesting still the all performance. was and so lower the preserved operating associated really second and negative with in it part in just QX as volume. negative than volume. It the We the The QX, can margin I the all is about We in volume never that it on margin mean, significant QX. see comp in less It's

that thing is is XX% of and full growing to So about segment more the for the interesting year very well, dilutive it's targeting balance biopharma.

itself. we they're it grow a the least reach to right it's at portfolio to the interesting of So now, segment on to those XX% XX%, does get have track difficulty the that probably or of because bit little just effect of of the portfolio stay if -- that on parts significantly

turns news we've waiting from going half better is, to headwind 'XX. forward, like but expect been and a biopharma to tailwind in now, it that a the at But we'd looks be tailwind material

Operator

you. Thank

America. with Obin next comes from Our question of Bank Andrew

Andrew Obin

Brad, a question.

tripling can guys just a company. a pump the pumps, that for the you've additions talk HVAC expansion Now heat are swap areas you swap little in European Carrier company, just one heat bit? key for your about highlighted talked we think I capacity or of about market for

guys You keep this have you up tripling at in Alfa -- highlighted that you see order to the and sort of And right sort you How top how incremental up enough now? with the I market? upside in Laval know this of of see of business. sort this market? and do you the capacity screwing coming do of Do market competition

Richard Tobin

We to out have marketplace. put in not what time digest of terms Carrier had the there the

So, pause several have European now I'll a on We participating heat pump market we the years. the in been that. take but for -- growth of

proactive we our I in think terms building capacity. that are of out

capacity we early is to increase our mentioned, target XX% for by SWEP. As 'XX -- in we

winning is at at the have So part price the share right right available quality point. the capacity product of to

So that's we can do. all

balance terms from don't of here, We'd think to it's we we'll that we'll growth future pump So but European expect is in want in expect world phenomenon. a part Asia whatever what we heat expanded just make over that Europe, and lot also. about estimates of be you and receive would the we've driven capacity a be, United of the expanding we're that's just to in progressively not regulation why the technology actually States the by adopted our

Andrew Obin

XX Where because capital. not the I about insights you balance of rates asking I'm of credit you but Dover the about months just past order of just sort not about agree chain over just a broader It the between on normalization whole thinking to entire dynamic? in Dover, with are rates, you order you're impact brought right, have starting and state asking seem think rates. great your supply the about And release the rates, order the question, does I'm and availability order for as just you would economy industrial -- working economy

Richard Tobin

can't remember one just and lot a song about marketplace, one think macro the blind, uncertainty we we're That of run our Sammy got Yes, watching meaning That's way here, on tailwinds. the years inventory there's the brake. frankly, sheet. in like it of Hagar I carrying trying right. gas that be can't balance to And that the own foot some we here. not two we've the we've But around for been quite excess on

for to So, kind it was natural us of liquidate.

Our watch points are the businesses constriction are in that subject we have to that credit.

So business to driven I of loans is wash the be pick way here, that to overtly be not one our carwash. negative building matter out mean, in and to Well, credit going getting is largely certain the tightened. requires of is fact car and a entrepreneurs

that door to the move our into big carwash for now retail up We'll Now, space? clients the open see. does meaningfully

driven a in there's recession, get. to moving day, my that a and parts lot the think to of I So, we're view, here. consumer it's be which going end personal At going of the

or fully the air that is, in let a position to all of slow of right. no balloon a like implies negativity way tailwinds that a a offset going the opposed reshoring now amount really whether meaningful is that variety Day, our regime by talked think, the of kind of I Investor about regulatory or is we into other degradation yes, of here that a shock. during from the the out of capital as But kind right macro

for this go as but and all your into We've to the that got what going by what's as is meet your to going numbers meeting management we do the business and no part corporation trouble, of to right. we year say, way. we're run business have plan, and plan is soon your have right, done, choice we're So, Q&A a what's if basically to here run

Operator

you. Thank

Halloran Our comes next question Baird. with from Mike

Mike Halloran

the restaurant, nice following side the stuff? notable? the are any the you CapEx or seeing the larger there? side longer obviously, guys climate Are change you patterns Hagar Drive what cycle, up on not XX And last that about on real thinking later question By just Can't type any -- or what, I the but on in you anything that at from that's change there. How seeing are anyways, cycle the maybe way purchase Sammy booking

Richard Tobin

getting in we the makers time kind a Well, look and our modeled pausing your, big if in we're out are together. and saying we'll that modeled footing good after of forecasts. what can run pretty can build into in right heat leave beverage But a that the had I you lot so their go make, of reduction the they're issues of for CapEx And a at pumps, going three-year being. was there is alone think,

operations expect which more stations On the it's drives we have retail for still because is stations, there. good side, do I those building us. still are, overcooked, taking lot a amount fuelling smaller lot actually CapEx basically is the around much of We and retail consolidation think you of complex larger that a negativity see of there, which CapEx when

quite But of the Asia good Mike particularly in capacity costs plastics moving at terms and a day, bit. end expansion, raw North is in the production up of of energy little despite America

more is but and tightness affects OEMs think the big second points that's that credit for So, may there kind of CapEx kind us the for layer, not like of where be for we how some watch tightness. for

Mike Halloran

sense. flip side side or that that there? side the that stable relatively trends any perspective movement seasonality coin cycle on a And and No, real been of on short on makes the from

Richard Tobin

It's been stable. relatively

Operator

you. Thank

from Our with Mitchell comes next question Barclays. Julian

Julian Mitchell

don't in had yet. got sequentially. has which good check wanted I attention DEP, One on was a first down much to on quarter just point But very margin you in think I the expansion year-on-year,

we a we of for you a sort flattish kind sort as growing, year should the as I that have they're the or understand segment? Do of for expansion the think vehicle decent first does trying through any the that guide, similar And whole. of Just margin it's impact see to about is half all year aftermarket Is margin of move year? think think sort margins to margin you that loaded? the as the

Richard Tobin

go should margins up The into QX.

and look performance. back at QX So that expect we margin production come if QX you solely would go you're rightly, on down margin,

would down accretive to how from to expect year we view a margins comp I expect from think point have because the we'll QX our come So, quite and up we'd we see until but then margins are of it robust. here, end

that flat, instead not terms margin calling top to segment a that's a in vehicle, the as of a negative market the opposed more it's consolidated comment, right, from so margin comment. line of On

Julian Mitchell

no unpunished. prompted of deed go That's know some follow my when We've lot give up, quarter I had helpful. letting a to tried sort commentary. And of questions your and commentary then, QX good just in you of on second spirit the

color, could So, put point I could fully second you was of just and too put look don't if kind quarter QX kind know not you different -- low up that there you was year year, the single doesn't on any that quarterly, finer you EPS from digit year in saying quarter any performance? guide so on year but do that on second I if understand wondered

Richard Tobin

comp of and margin the more it's comp looks, performance terms looks similar. think Julian to revenue I in of

$X.XX which Now, segment line believe kind of EPS of that, we having an said dissipates. headwind headwinds, we the had of below

did to get EPS to we want it. So I accretion don't guidance quarter, into quarter but

comp the on at line if we you So, and look of to should the the it QX items. probably same below looks headwind similar it saw QX, QX the at relative look look QX -- that the to performance some performance, QX if without comp, do you for

Operator

you. Thank

from next Our with question Melius Davis Research. Scott comes

Scott Davis

better book-to-bill would of don't in price is to covered it quarter? together, so said horse. book-to-bill the dead it answer's piecing than that you you haven't here, I earlier I a in it want that be beat been territories yes, say, A like know, fair to say But quarter Rich, expected expected it that also heard the but sounds that. better in the was I mean, comment that but than clear, you explicitly lot

Richard Tobin

full the we growth peanut the revenue that we the price the price that overall see what from but buttered over price the No, is just is sequential year. have, accretion for

not so, out new there. as pricing And it's put we've if

effect take and day, of imagine of bit a you accretive we revenue around terms modeled, that I'd a what calculating look streams mix And of kind so go have to at is more book-to-bill here, mix that back end in that can is on the many the but as have difficult.

lead into coming it knew a were we backlogs quite we knew, 'XX carrying Scott, our times overall, customers and that knew down and we big bit. was, our were But,

of we order of the expect do of bleed rates. a the but kind So in to off lower backlog, it more would it would it not reflect necessarily

don't we're got know, be need numbers. don't We kind like I one one for because we if which in to inflection and our trying hit us one. backlog you good what we've modeled orders, allowed into, mentioned to We one the don't in But pretty do with a not terms be we get of as in said, everybody depletion. had above I back, this year why need to panic above above coach to to that's of let's above March

Scott Davis

Yes, that's clear.

at going to that it guys. keep I'm Okay.

You it answered of and else. I appreciate everything best luck.

Richard Tobin

Yes, thanks.

Operator

Thank you.

Josh next with comes Pokrzywinski question Morgan Our Stanley. from

Joshua Pokrzywinski

lead being in then in direction. it Was in rates booking that terms context in these shorter March the on comment to like of more was longer they do of lead the or cycle really that on where And maybe chain of you would waiting see the that it improvements? these back? folks to just wanted in opposite put surprise what that what cycle to see be of what impact longer supply was stuff? kind to can sensitive you expect economically or waiting time came were better, kind time Rich, businesses Or and

Richard Tobin

Both, right.

biopharma had that positive and So, we inflection about. you talked

longest fueling again QX. which long is which I polymers, expect it cycle in well to positively, is cycle a But think, the very book very plastics we and business booked retail a well. side, And on sign. inflected good

mean, So, day. the at the end it's both of I

you're even going -- it terms long QX. is cycle So I in had which -- time we But see and cycle to in the just by of there order of haven't but short can you close exclusively an probably short tell the it's cycle, an not to dissect overly we backlogs it's time order. in by there, because our element

Joshua Pokrzywinski

I we see sustainability, that time steady some just far? would And the coming and outsize maybe should see you effect mix what Process. of think quarter where & climate period kind a on some something mix up Is mix seen or expect, to there decent avoid, thus you just happened a in then we've or within show just of can And there's Pumps like there. to progression

Richard Tobin

for can't accommodated some making. at what transparent our overestimates something was the of not there, flat about margins exchanger I fade forecast mop systems cycle because everybody think the we which would that see Belvac, we is been and are margin because in it's get minimum kind as what into we in can but year beverage there. beginning the full up COX to mentioned. We of kind heat expect to We've

Operator

you. Thank

Mizuho Our Linzey from final question with will Brett Americas. come

Brett Linzey

biopharma. stabilization Process. question First & to Pumps Good in on some see there just

curious next the into we're the expanding obviously the to benefit how to year, XX% think on sequential mixed I should be some mean, year, thinking other going improvement we about side Just here that through back XX% about level? but

Richard Tobin

just point of actually Look, the day, margin the that margin on aggressive. as going you of on down. itself. I would volume not up we of clearly mix view, expect tell reduced the it's That's way give the All We that positive. mix at from is did we pretty end a the gave can I segment effect back up up mentioned,

margin. growth implies think sitting, We best of year, healthy that in implies half year full my it the at trying positivity, as for opening we're And that's but second the amount know of positive. why to some I comments, get in mentioned XX compound we're which have biopharma some the some amount the our I we of to

if strip through the core COVID, XX%. Day, we importantly Investor growing more business But out the as we in is went the

some end, in profits get that we roll on and margin we we if margin. accretive the terms 'XX, keep So, absolute and in of can it back if as it's meaningful into growth trajectory becomes then

of I themselves if and in mix is view because point will do down the don't it. margin growth the drag, mix a of grow take little absolute they of tuck significantly a want from what to rest to have of the bit a segment profits but rates But you're to going

Brett Linzey

I spot just the think you think actions, in in of to terms capacity sizing called XX in efforts? quarter. Slide then more out is lined right in there first restructuring million on you with the Or terms you're deliverables? ongoing are Do And you a good Where pretty of X, do there?

Richard Tobin

We've this In fueling bunch last we actions out XX% probably some year, I took think there. solutions, that further taken cost year. of and a then we're

around here. cost team of kind their is of the the demand structure job from management a of model that going business real based is arms getting good the business we that doing is be positioning what So, going on believe to and

think the the Having go the go I opportunity said you some and of to portfolio balance it, footprint think that, And read would further that we wrote that fact into I the see back on. think in year. this to if comments, I actions and of as expect begin I you'll some

Operator

you. Dover's our concludes That call. earnings Thank first question-and-answer and XXXX period quarter conference

may at time have and your day. line disconnect this You a wonderful

Dover (DOV) 26 Apr 232023 Q1 Earnings call transcript