Recent EPAC transcripts
Associated EPAC filings
Bobbi Belstner | Senior Director, IR and Strategy |
Paul Sternlieb | President and CEO |
Anthony Colucci | EVP and CFO |
Ladies and gentlemen, thank you for standing by. Welcome to Enerpac Tool Group's First Quarter Earnings Conference Call.
As a reminder, this conference is being recorded, December 21, 2022. It is now my pleasure to turn the conference over to Bobbi Belstner, Senior Director of Investor Relations and Strategy. Please go ahead Ms. Belstner.
morning Group's you earnings first Good for joining conference operator. Tool Enerpac quarter you, and for thank us call. Thank fiscal 'XX
are Strategy Chief call Sternlieb, Also Colucci, with the today Barb present Officer. company's On Bolens, is Chief to Chief Financial President Officer; Executive results and us and Officer. Tony the Paul
section. available at enerpactoolgroup.com website Our and presentation slide our earnings for the on Investors release today's call are in
We recording on call our will and it are archive also this website.
reference will and we call, measures such margins today's During profit adjusted non-GAAP adjusted as earnings.
schedules to You this can of reconciliation find release. a non-GAAP GAAP measures in the morning's to
also in you today's remind that not like presentation statements and statements. making are that be are We call and would historical we to facts will forward-looking considered
pursuant federal forward-looking to provisions materially to SEC statements Harbor from factors and our see results anticipated those securities other Please for may results Safe of statements. the filings risks differ forecasts, that other the making are actual laws. cause We or
the turn Paul. will I call Now to over
Bobbi We a of great term virtually. update interact City. XXXX results program, The Thanks, York joined growth showcase both all transformation am our want our of into focused targets on before new quarterly everyone. discuss jump joining was to update, for strategy November few bar with and Day to pleased call. and opportunity both Investor you Investor New our fiscal in investors QX in long ASCEND we Thank theme earnings that was that new to event recent we launch our quarter this our raising spend Day an and morning. I results the you recapping But analysts. good I with a share moments and and management thank first and the our morning, provide our us held you in strategy, person our financial team, the
XXX% CAGR, XX% over and exit ASCEND as 'XX greater EBITDA XX% of the our recurring rail you in flow to along Pacific next including expansion robust continue benefits conversion the replay by compounding and program, approach in growth that margin latter ability the XXXX grow a fiscal event the updated our on greater transformation game we free strategy verticals ASCEND we and of fiscal innovation these section. than and strategy watch margins to effect execute. is website not we in we adjusted as EBITDA of issued organic invest and that If Investors which Asia growth to targets, under updated attend, and of X% available out, you able program, the cash to growth our margins two years. than the includes adjusted the we four laid solid and cash plan the our encourage year wind, strong digital targets The with revenue achieve sales a were our is on generation on model focus our full X% driven we our confident to plan including industrial remain that creates MRO, infrastructure, financial to updated our in transformation years Based
merely The and we're making create expectations hard our XX% and experienced strong organization value stakeholders. that sales adjusted additional XXX of reiterate how of to potential to our will with improvement team's Enerpac resulting first the moving details growth for want Group We by results, the four full unlock historical implementing in driving just our line seen quarter, incrementals, quarter. to our helping I thanking results XX% core incremental in financial globe provide on year-over-year. our the but that EBITDA the were solid excess start regions. work I EBITDA another across I profit points across over all Now to want well basis execution in deliver the quarter, to on us XX% can for to their top in be the the ASCEND progress employees in for all margins consistent excited about with Tool Tony am in
excellence Slide in shareholder. and on as greater on to to Moving enhance in organic X, we launched ASCEND growth, efficiency focused announced driving transformation productivity we our March, SG&A program and operational improvement
a We on opportunities mature very target. we've excess in of of made late have funnel progress and ASCEND stage reached solid now our
exit to we transformation We of in in including found the year. million $XX $XX million current of today's result of the million program can fiscal of expect a as benefit overview the ASCEND appendix to benefit fiscal continue presentation. million An XXXX, to program $XX the be $XX EBITDA additional as adjusted of
our Now, great move the a of that take on, want to before morning did to progress few moments various team initiatives. we of ASCEND this I highlight some continues to on a make few our
helping simplify actions the commercial to grow are marketplace. the in and refocusing investing and win and positioned efforts business that taken to partners On focused best the distribution we've Enerpac are our side, on to our our network disproportionately on we behind we're
we've addition, simplified growth Enerpac the a In tiered of distributor that sales. our approach to structure discount rewards
indirect cost of exciting of additional the the are our costs around are take legal the to by visibility XX-XX greater spend reduced and we structure not and tax We've regions. reducing negotiations. maintaining an of which associated but savings initiatives accounting, Tool controls direct entity As an our reach just and examples the Of of it we discretionary on work our the in additional all legal million functions back overly the Enerpac relates complexity this supplier with using the and drive complex a from to both approach Group, business last cost associated number intermodals entities and across to across within and an spend actions lower $XX adjusted an of improvement in the of that some shared we we legal backfill will example, office consolidating key future $XX estimated fiscal service tightened benefit least, ASCEND, million recurring of benefit to benefit also of for offset anticipate demonstrates roughly And a SG&A, procurement, roles to and some to material XXX to of the perspective. result associated broad our a move started program These as not organization. ASCEND approximately restructuring high a adjusted EBITDA excluding related and only million to a percent additional Again, of revenue, the our much but and for as be we with $X strategy. operational saw structure, which program. highlighted organic and focus costs, quarter, for Investor net is we experienced partly of we key more SG&A productivity. first discipline ASCEND, by million also Day, actions approximately $X and in the basis our XXXX $X is than points growth to in is to efficiency aspect cost a degree of Also, date. a costs taken at ASCEND There million few growth as innovation
and powered So we I to based we wanted share touch movers in orders. in first received quarter to I'm new spend the our activity industrial a moment that QX. skates already have for several machine battery NPD on launched to excited our
to methods increase the ground, machine These keep at skates They complex the confined load the especially we them a the hazardous manually of reducing always These powered labor operator is self-propelled, jobs overhead clearance challenge, load. conventional and the safety. safely safe the distance machinery overall safety industrial just are also close to how the eliminating pull machine heavy more to where help is often spaces push need away innovative customer possible the move back to importantly, the below in of one by are either are efficiently. work intensive through Moving and or allowing driving This skates battery innovation ensure unsafe. a required or to load. example make from facility
X, it Europe Slide total solid to in and notable relates with our particular as markets, to demand to of strength four our Americas see growth XX% and we all products. for core our continue regions of across year-over-year Turning
business we've remained component our quarter. availability we've in begun taken macroeconomic second initiatives and pleased though signs walks EBITDA inflation the through quarter, a in slowing inflation continued commodity the We've see solid the of the decreased we see our rate benefits you'll to backlog not to our be incrementals our in see the offset remained impacting first challenge. continues did or quarter. of weeks I'm order quarter-over-quarter, When of have waterfalls, positively price there recession While within to through and the the few that pricing the a first of than pending the into recession and uncertainty impact path slightly first ASCENT see and margins Tony rates have actions that our more
driven sales high Moving the quarter. standard to were In year-over-year solid solid teens percentages Americas product on was particular, the the experienced regions, core primarily product sales in by in growth. the and first growth showed activity and demand demand digital stock nice of ASCEND [ph] and as experienced sectors. some due a maintenance solid ongoing for most had manufacturing to within turning result rail rolling The Americas across our tools. shipments This
around lift wind. business interesting some heavy or is Our seeing opportunities HLT
gas, moving future As but rental bigger within The partially was build year-over-year streamline process push-out was by growth to offset and opportunities marine the bigger ways those HLT. driven OEMs turbines, the wind transportation and within for getting space. projects looking the oil of creating offshore, for towers for in turbine and and demand are by modest are some service
by stocking was channel, recession. distributor driven cautious, expectations with the were the in sentiment the within line remained of concern While steady potential orders demand and
up in place. the direct caution demand year-over-year pent-up double-digit Europe, very environment. Russia-Ukraine in benefited some additional government is neutral due due and a with our now some sentiment that course energy and ongoing down. continued also services vertical growth a the perspective, generally both business future creating sealing favorable macroeconomic infrastructure previously Overall, by delivered from sentiment particular, in infrastructure region was consequence was government created and the prices HLT is deferred From with core Eastern opportunities the the gas this and current In are and The driven aging on taking is In investment our demand. to is and to low distributor this in of product for service. Central by conflict, leak in both the Russia-Ukraine work rail Europe, driving Moving Europe. of being Oil address good areas opportunities. high crisis to market investment investment region the percentages,
to on chain Now disruptions year-over-year some be region in COVID with core moving to had continues creating Pacific, supply restrictions a China Asia the COVID in in Unfortunately, a quarter. challenge percent specifically single digits. low the the growth
living favorable materials to in local vertical with COVID. iron some easing travel driven China COVID are was the by Japan transportation be governments and now to As from China. liquefied some Shipbuilding XX, driven of precious and and gradually and continues in the restrictions of the mining primarily in the of Australia Korea also natural no-COVID quarter, by positive, a coal is perspective, From December for demand ore, gas. market moving coal, in and test
Turning the to growth Middle East experienced core single percent. year-over-year the low MENAC MENAC region, digit in or
region quarters, out maintenance Energy be being quarter spending the the we've the work As has last in action on few delivered downstream pushed continues up. activity market vertical of on to make large producers begun we to including our overall ramp previously XX% to and expect and energy. And quarters continued continues has into moving to was investments gas a new first will continue and to the seen first renewable into From oil the in perspective, few make continue be activity Cortland, past quarter. projects infrastructure gas relating favorable to that core in region our oil to significant and generation, power QX. investments investments and growth business the in year-over-year Cortland fiscal in
future business, demand XX remain development a for development On growth. we over products we the and healthy that to into products commercial pipeline projects have orthopedic production and additional moved the rates the first the quarter. launched medical With order very fuel phase, side in stable from of two in
and of I'll be for results and first in to arrow improved to requests it an the it times first related Cortland oceanographic over projects. nearly by capture particular, walk responsive through defense more quarter. solid federal with financial as oceanographic to update Tony additional customer and and quarter favorable us Cortland's Moving defense oil government and as the quarter, Cortland's end and gas industrial on Overall, operations. business, orders and well across In enable were to strong turn on lead all the the Tony? markets. aerospace was a in now driven seismic, QX to side overall, funding the performance
Paul. Thanks,
million, profitability of first increase from XX% core XX%. for Turning provided year. is the XX% up QX which incremental which compared year-over-year. quarter, in to of up sales begin is net to QX core resulted first sales quarter, XX% in solid greater line the which This product quarter. over tax bottom XX% sales fiscal were prior XX% The Courtland sales rate $XXX and up IT&S an Slide an was core sales EPS were margin adjusted adjusted the core our XXXX. to reflects a and up were a $X.XX, year increase increase year than quarter was in service results; Adjusted $X.XX of the prior our XX% adjusted EBITDA X XX%, currency-neutral for in a X%
were in the million, driven over quarter; of APAC. declines primarily except to by demand and for All X%, was increased the MENAC the with continued the double-digit including strong growth growth, X% opportunities. core products. our strengthening Service the increase in digit product from QX by MENAC dollar, experienced by by US oil growth over ASCEND reported in sales FX products regions the Turning sales euro the offset Cortland. for headwind double-digit remainder sales core and year-over-year performance gas Product net IT&S details driven first core to our driven and strong XXXX, Slide to Americas and with MENAC the XX% This year-over-year in of partially sales our GBP. $X.X single reflecting of and up sales grew on related XX XX%
contributed million top actions pricing $X approximately line. Lastly, to the
net and new driven the peak first demand, EBITDA significantly in million XX, strong of to a product Turning our launches, $X trend Similar quarter XXXX, execution approximately to on QX, sales improvement. year-over-year the Slide EBITDA consistent COVID the cost stronger reflecting fiscal $XX.X volumes EBITDA. EBITDA product year. versus prior which strategy. prior to profitability, $X is an unfavorable to dollar medical realization IT&S XX, range the of contributed exceeded four and margin EBITDA years net an profitability, from quarter, sales the of mix $X.X adjusted year of product to $X ASCEND delivered in along of by pricing roughly Transitioning additional Cortland by of in had we and Slide of improved adjusted by million million, actions prior Higher industrial Pricing price million contributed the million impact in the sales quarter. increasing with which reducing the million $X US improvement resulted growth sales, a
favorable prior SG&A tied up European increase a stronger in partially entertainment, and costs $X year. in from higher million taken accrued with incentive an actions compared expense, travel compensation, primarily the by non-recurring offset savings and insurance initiatives. year, resulting US restructuring to ASCEND from along prior was The when to increase the the to was impact largely driven approximately dollar, Excluding the
As favorably impacted quarter strategy, by million. was execution the Paul the ASCEND previously approximately which mentioned, first positively impacted $X quarter of our by adjusted EBITDA
actions recurring beyond. will costs, benefit quarter there program However, timing an between recurring estimated incurred $X of million. transformation the to differences and savings those in fiscal $X be $X ASCEND benefits associated future net our charges will from million XXXX due additional throughout be expense to We approximately and the approximately with recognized associated recurring million restructuring and in for
beginning parts previous challenge. availability, to backlog signs Moving of and easing for some to supply the improvement, remains electronics a continued due Most on challenges. but to our some component over past chain particularly plastic quarters, post-pandemic notably, show see operations; of as discussed we is
price commodity back as are the positively We continue see well, costs a during increases freight trending and quarter and level. to normalized to easing
European As we highlighted rate quarter, also last watch close increases energy as January. are costs remained a for planned
XXXX. continue negotiating actively the minimize we seeing, is headwinds do the team signs some expect to into procurement contracts positive will that impact. that calendar help Our are new we Despite
Lastly, evaluate effective taken on standard actions the pricing price environment. in the had in inflation benefited and the from effective previous announced XX of the pricing increase mid-November additional pricing December first continued quarter, we products Americas to and Europe, for in certain In actions response to face we inflationary distribution.
million pressures liquidity will XXXX. up We'll inflationary free positive with of financial to continue react monitor with forward, cash XX. Going necessary. wrap the generated first $XX actions additional in as on free and to We flow of we the summary pricing during Slide $X flow quarter compared QX million cash negative
working million translation, approximately receivables quarter. by $X increased expenditures of incremental due foreign offset of approximately in and approximately impact inventory. capital the million $XX Capital to quarter, were million the from by the $X decreased lower million driven payables, first strong million primarily $X partially of Excluding currency collections by in $X
Our exited to compare X.X times leverage times X.X is to at our fiscal well below range of X.X target times remaining X.X and times we as XXXX.
dividend ASCEND long turn of to back with to a payment believe our other committed includes the Finally, allocation our liquidity, positioned million we which our made QX contributing we cash will position leveraging program investments, internal I our shareholders. flows We overall support the With remained we are for we returns capital call solid to last quarter. for strong $X.X cash and M&A With balanced declared annual priority, our that, to along to transformation value growth. Paul. shareholders term drive to capital disciplined well
EBITDA $XXX fiscal first fiscal the in the a In million to weeks solid previously EBITDA second of year XXXX September with be typical continues million, in broad to to $XX EBITDA million our demand which of million in Tony. quarter our fiscal adjusted order announced of $XXX range quarter, seen guidance, progresses. on are fourth $XX we not based to a exchange not trends and is assumes thanks margins there change net as incremental million foreign to no improvement based and changes benefit recession. and from noted the that There remained $XXX including three of adjusted Okay, sales have ASCEND rates ASCEND $XXX 'XX. of This an an is as million, full
Enerpac up, I I that would accomplished like organization just work that over wrap ago. I am of as reiterate year Group Before the I we joined have since an to proud a extremely Tool
With that markets transforming We of economic our macroeconomic positioned the uncertain balance and on was which well results. New we to evident our enjoyable first environment, has We program the your and the hope you are that work joining holiday season safe despite you transformation that loved you. a in up quarter believe earnings look end forward Thank done manage our that, with our sheet, QX have global us ones focused and we thank related to strong and with ASCEND the catching in for diversity business to everyone uncertainty, call. has we through Year.
today's teleconference conclude Thank and you. webcast. That does
time thank You may We line your participation a your you disconnect today. and at day. for this wonderful have
We use cookies on this site to provide a more responsive and personalized service. Continuing to browse, clicking I Agree, or closing this banner indicates agreement. See our Cookie Policy for more information.