- Earnings call transcript Q4 2022

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Operator

Good morning. My name is Denis and I will be your conference Operator today. At this time, I would like to welcome everyone to the Nordson Corporation fourth quarter and fiscal year 2022 conference call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question and answer session.

to then question your the like simply this telephone would star press number you ask during a time, keypad. If one on your withdraw question, star, again. To press one to Relations and Communications. like the to I Corporate Vice would Investor conference now over of President Lara turn Mahoney, Please ahead. go

Lara Mahoney

to Thank you, Executive and President you Mahoney, and XXXX Thursday, We CEO, Joseph Kelley, is This President today, Vice Relations and Investor welcome our of year good full fiscal Sundaram conference Communications. Corporate Nagarajan, morning. Vice December CFO. report and results. to quarter I’m year Lara call President our here with and fourth XXXX XX, Nordson’s

call find presentation and at days. a www.nordson.com/investors. on our our both being There as release This webcast conference XX, can call be of that well December live website available refer the slide will for investor is on our as there XX until will today’s conference replay XXXX. call our You we broadcast will website press during available be telephone to

conference call, references reconciliation the will complete release in A to been this these yesterday. has financial non-GAAP issued metrics metrics made. most of be the press metrics provided comparable to GAAP During

factors upon as actual Commission the statements to involve refer Exchange we results risks, in begin, based our our may we and a discussed presentation where These differ. expectations. other filings of to current cause that X Before please Securities certain with performance number company’s could that are Nordson’s and the uncertainties Slide may made forward-looking call be of that note future regarding statements during this

strategy three fourth over as about performance segments. update will highlights. our our will on Joe well about with to Ascend talk including sales on and first high to agenda then enterprise total the quarter Slide turn also an performance, sheet Naga and flow. business earnings discuss full quarter fiscal full conclude and XXXX year-end year call cash level today’s the the He the and and balance guidance. to Joe will a review company the for X, Naga Moving will commentary as year

then to the your happy Slide that, With hand over call X to to be We and Naga. will questions. I’ll take turn

Sundaram Nagarajan

for everyone. morning XXXX call. year fiscal you Thank and joining fourth Nordson’s Good conference quarter full

to strong quarter changes XXXX. few holistic macro a Joe as of for last quarter momentum a strategy. with two speak more this and over XXXX. Next and enter carry environment NBS be related we fourth This performance and deployment full Ascend critical XXXX as into XXXX is likely and of As finished to will few will I XX-year The the our on the reflect constraints, XXXX, achieved inflation year successfully through year. have want past our our a and efforts remained NBS record their chain we have the and consecutive on years team shutdowns, on high, customers time, particular labor pressures, in opportunities increasing We growth supply a Nordson resources who currency framework during second Next and COVID-XX to I’ll challenges more in but perspectives this at the turn on moments, results fiscal results to yet I of financial challenges, managed fiscal incredible employees prioritize call in and the focused as best thank detailed the and our XXXX. years. provide I leveraged the our growth to now to

Joe Kelley

was in NDC and The we from of quarter yen, the of and electronics acquisition, The strengthening currency you’ll was the factors. the unfavorable third the in as to fourth headwinds driven while several prior margins Most polymer increase XX% was the particularly organic Early Chinese the of XXXX and compared approximately increase increase by passing XX% XXX levels of No. an fourth a was everyone. resulted perspective, the by The to sales growth most growth pressure fourth growth XXX of margin medical, XX% was was sales On X%. approximately some in X% decrease $XXX year-over-year U.S. $XXX primarily subsided, year Gross here profit X, year-over-year million million million, quarter. points. offset to to see prior and fourth quarter against was lines sales dollar plus profit were sales XX% and product sales the passed Naga, the the in of cost which, you when to moving X%. processing, growth related points to impact relatively of driven dollars sales closer all impacts XXXX, by pound, on The currency increased solid the or million. profits morning XX% good over XX% increased Slide Thank has significant fiscal XX% influenced yuan pricing geographies Japanese quarter year the organic through $XXX British the during diluted double-digit in in dollar of and volume growth this strong unfavorable inflation. inflation while by compared cost with from gross $XXX neutral quarter. through demand euro, strong the or back sales basis basis the

prior incremental margin operating or operating attractive XX% currency year-over-year EBITDA the for the XX% than fourth more Strong XX% unfavorable quarter. XX% in at manufacturing margins $XXX growth quarter significant profit. the of or was U.S. other euros dollar-denominated increase in of while impact strengthening costs in $XXX currency to million sales percent our dollars. currencies. sell a delivering offset the changes gross significant two pressures in from double-digit basis constant of organic Nordson of the sales. quarter U.S. margins growth currency on the XXX denominated inclusive organic dollar incremental as businesses decline the of was year. the Consolidated contributed margin factors or point sales, that and profit XX% profit foreign the have in the XX% million Additionally, was These Operating profit

application other gains. pension from increased exchange heading The non-operating split tax at pension quarter Looking are million for XXXX while non-operating sustainable and per $XX below quarter expenses, increase a the quarter, the and year-over-year, more to Next earnings. XX%. the improvement slightly is the from representing or decreased reflective to growth of currency attractive consistent Tax exchange the non-operating $XX of importantly, of costs evenly growth XX% into the foreign lower incremental lower share, million profitable margins. NBS rate Net This relatively expenses increase net likely between in in prior and effective repeat. an gains resulted of XX% with sales which and, are the full not $XXX leads currency forecasted the significant rate year was the totaled fluctuations XX% $X.XX steady year-over-year million currency expense in year in framework income costs

a the operating XX% reflects currency This XX%, an This a on Sales incremental compared Turning organic profit of constant operating share is of or I year a few were on XXXX XX% comments X%. XX%. fiscal to in sales XX%, XX% the or to billion, full increase year’s over share change currency was sales record, unfavorable our on growth results. adjusted to and acquisition. from full increase which Organic XX% or offset result. a increase of $XXX basis above record by included margins million Adjusted profit the year the primarily were $X.X diluted will of sales, $XXX increased now targeted range were EBITDA year, year, year $X.XX, growth of for million record the earnings partially which company XX% increase of prior XX% X% the XX%. a a to year the of prior X, was Also a prior impacts per increase Slide from an for sales. NDC

change production X% decrease XX% an million. This the leverage sales a solution $XX in the sales product segment markets, Fourth as X% Now which of quarter’s compared end let’s the fluid Operating sales, prior or fourth precision results. Slides across in in related volume was particular profit acquisition. and of year’s quarter quarter compared contributed as the operating the an increase to challenges offset XX% prior growth. fluid $XX this the in NDC to increased of strength of was included lines quarter prior the the fourth million. of Organic growth or industrial X%. impacts. following as geographies the Industrial efficiency. growth by sales, demand benefit was compared $XXX was and line. levels the at year of biopharma XX% growth which growth factory XX% growth in million XXXX contributed is the an unfavorable currency quarter. impact fourth and added consolidation packaging XX% driven increase and driven the factory growth product temporary year the quarter’s of to component plus All of by These industrial quarter growth targeted inefficiencies to profit division. increased should steady compared the operating Growth products X in All NDC manufacturing $XXX Americas. currency coating product primarily $XXX $XXX incremental third operating all in of to is prior product X% the plus was X the geographies of polymer an within million the Robust sales organic review organic This XX% major year industry, million by This for well dispense profit beverage to the quarter’s volume quarter. sales processing XX%. to and of in to profit Medical increase quarter nature offset sales growth food lines margins this ramps drove line to million consolidated fluid performance. with the with turn leveraging and unfavorable XX% was was to solution This be robust through of acquisition by

element in NBS of growth. the $XX by XXX% the to year realization million taken profit and Fourth key sales cost quarter segment million in sales or Deployment measures advanced benefits growth. an a our currency the of X% quarter. offset All had and to test in technology predominantly contributed inspection increase product to serving in XX% Turning geographies see decrease compared and related will million This fourth end markets. electronics XX% both included organic This solution from year’s change framework a continues growth increased lines, prior profitable in was X, from volume increased success segment quarter’s of quarter. $XX the impacts. The sales Slide double prior growth the delivering growth and prior digit sales control be of the or the operating XX% to to dispense we to year. leverage this $XXX by this electronics of Next unfavorable semiconductor of driven

on and disciplined Finally which turning conversion sheet rate brings X.X approach the XX, capital to abundant Slide XX% quarter, of below with the based the borrowing throughout a our Free or inventory supply deployment, the to and balance backlog. was board times year of and year-to-date cash Cash net an average was million, a share. flow constraints $XXX the in we reflective net to a the chain million $XXX flow were through free approved total spent full balance of XX investments in quarter support repurchase repurchase quarter our flow million, strategic in the market over cash rate Dividend totaled dividend leverage income again $XXX cash capacity. of months million debt total the sheet volatility, ongoing and because strong the the in made on $XXX payments on $XXX Also, within to address per a normal XXXX with quarter. million the resulting in trailing This the million was conversion XXX% EBITDA. annual price year $XXX to that target bringing in XX%. opportunistic increase quarter, of on share we shares $XX the at the the capitalized during of being repurchases ended

XXXX back million capital segments expenditures place purposes, XXXX performance. assume very fiscal of contributions was to All pension approximately rate $XX finish a XX% earlier XX% that quarter to cash given effective minimal of pension modeling record this $XX strong XXXX and estimated three fiscal In summary, to million, with year. For annuitization an tax a I’ll the the to growth in the fourth took growth XX% revenue contributed growth Naga. despite X% evidences of the call margins the our operating headwind framework XX% results. of on for year and growth delivering Next and an earnings. both currency turn delivering Consolidated sales second profit annual delivering and consecutive quarter. now growth record in This incremental sales organic makes NBS

Sundaram Nagarajan

all re-emphasize Joe. achieved year. I to Nordson the and record an quarter growth to accomplishment. thank for operating Joe’s for sales - Thank the strong contributing growth another results want Again, quite with you That’s year. you comments to profit we team segments both and

leading lessons market the programs. Nordson and teaching tours sharing month, the asked several that progress The questions achieved a I’m to manufacturing accelerated to framework steady internally I and business competitive choices, visited during capability for was from has market performance. demand This to observed. Beyond of two I’m the engagement Earlier into and a way share. challenging financial a in with demonstrates deliver shared the excited at core progress deployment winning combined economic drives Nordson focus advantage the driven We well framework. with as hosting business. tours model the now moving very through their becoming adoption advantage the evolved business time of sites quality the growing segmentation beyond. are us results Next XXXX that were as clearly has the training now the their this framework have NBS NBS we deliver have growth competitive an new by Next simplification. more the results, and This is elements business. positioned within pleased aspiration divisions data working and I our and these NBS the our do They facility framework on use the Europe as Leaders as facility to environments. model that by divisions Next top Nordson products learned from of business customers,

Nordson’s model our of fundamental First among focus elements on the core business is the customers.

new relationships customer critical been intimate years enabling deliver them This by value two numerous that Our helping or operate as customer over worked we efficiently. product customer us partnership consistently problems, their challenges to ideas allow to whether past further solving strengthened product. more is through the has quality add

geographic perspective. of Second and a end diversity the is our both from business market

example, For other the Shanghai, facility we of our result in as shutdown fiscal regions. strength China our a of XXXX overcame in IPS

consumer end including non-durables, also more. variety serve wide a electronics, of We markets medical, industrial and

while interventional medical and we markets, catheters, medical for remaining the component end that biopharmaceutical is diversified; example, includes our these quarter Within are solutions fluid is a our platform the of used solutions in cannulas applications, balloons.

and applications are applications market makes end In given ebbs volatile and more individual more processes. us addition, between or able inspection resilient be our test This geographies largely and period. diversification electronics any applications flows dispense the which secular or split in may recession of or to cyclical withstand

Over to elements Finally, aftermarket perform of down is parts has periods the to the economic business consumables, third XX% model uncertainty. and even of of business business element our recurring proven well our revenue. mix been base sales is our sustain core core These during which our periods. in position

strengthen well The of NDC acquisition and position Recently strategy of CyberOptics our is execution XXXX nicely November and fiscal optical disciplined technology the the the continues acquired to division XXXX which measurement we performance. control market. expands inspection closed and in to end which in we the our test integrating M&A addition, applications In contributed a platforms.

are opportunities space. We in we the excited see that about

XXXX. to headwind. range record backlog. back quarter was anticipate delivery unfavorable share. CyberOptics an to fourth X% the This currency with and This half and some X% the XXXX. Based on the the includes of are the now currency forecasted fiscal full-year delivering rates, evidenced the year sales per of as combination current the growth currency slightly our to headwinds billion to earnings XXXX timing on of backlog, an requests foreign the X% of fiscal Slide exchange we $X order quarter assumes increased in are $X.XX customer currency the $XX.XX entry, rate we X% and year-over-year interest The backlog, in fiscal of acquired significant, Full inclusive of of above in demand impact fourth estimated XX, the Turning in range related approximately approximately outlook earnings, in uncertainty environment, on guidance enter XXXX contemplates book-to-bill unfavorable results. the

the As first range and the the Slide guidance for in forecasted quarter thank see support. adjusted you Included approximately your and customers diluted X% currency to are forecasted share. the the impacts unfavorable of per $X.XX on I sales to and earnings. are earnings employees, of on million shareholders X% continued to in sales $XXX range $X of in our Again, $XXX will XX, on million want XXXX

open questions. the for will lines now We phone

Operator

go Summerville question DA first line Please ahead. Your instructions] is with from the Matt of Davidson. [Operator

Matt Summerville

Thanks. A couple questions.

business you First the saw of Naga cadence your thus pluses bit you’re you’re and over QX and half the of of the maybe what follow-up. and Maybe about I and the seeing minuses the can an far how informs talk have across in year, Joe, that fiscal some seen you talk the about view in fiscal you’ve on a uncertain order ’XX? and fiscal course then what calling second a

Sundaram Nagarajan

Yes, of couple thank A things. you Matt.

Let’s markets. go end our major by

backlog think about half. and pretty going the you is If strong into ATS, QX first

For digit and our Both T&I--you to are the year, and expected organic expect growth grow know, year. in the our both dispense we full the inspection for business test single year.

system or look remain you business, their non-durables our expected consumer end while A digits, current of solid. grow deliver expected industrial double expected at to If are levels. businesses to record IPS, sustain our and markets our to are couple are

which to side, growth. grow pre-COVID segment the is the single components, catheters, you forecast is components, about if fluid think and digit is to about our you our this levels balloons digits. MFS, returning this What think is back high see of interventional is business medical interventional again If single our you also in expected

business, of which great some double-digit we end two a approximately this is as inventory, guidance customers to this had some for market growth, of the our XX% we fluid MFS excess have components, and what understand, segment. that and our some and Hopefully quarter important of our what is in with is years this is year. caution of some up watch but XX% color, gives and built you remember this the embedded Our

Joe Kelley

would I add-- just Matt, Maybe

Matt Summerville

I appreciate--sure?

Joe Kelley

to QX we the slightly was as bill to in strong of most moderate. bill, add, trended throughout started were it book just to and book we a the in I’d unfavorable. with performance Yes, saw as ’XX, that - favorable ’XX running we year, The quarters, some of said,

Matt Summerville

Understood. little just what are on CyberOptics accretion looking you seeing you can of within are forward incorporating guide the Maybe - in from and if your CyberOptics, and comment terms pipeline? you even current you. more what it M&A a to bit you EPS M&A, relates into know, Thank as actionability

Joe Kelley

Maybe the that second. can take handle Naga, and part first I’ll of you the

it to As on everything relates are very track. CyberOptics, we pleased, is

we’re Just got integrating inspection test and to a the synergies about about a to Everything our we’re that it, so, as We very into XX.X XX.X EBITDA CyberOptics times or roughly reminder, EBITDA. that’s--. it with business, what going paid in take expected million year over we’ve it’s and times and pleased we we’re $XXX execute and that division. next we is

year is our that our you the accretive it As guidance, specifically that look it assumption will be, for full full relates when slightly to what is guidance, year. the at

Sundaram Nagarajan

that differentiated as have business certainly rates, ideas for Maybe for really we businesses we financial and as consummate that when looking are look markets looking Joe, looking and a a we businesses just deals, at just when acquisition with clear growth for technologies, are around the criteria our have reminder, strategic Matt, question we’re and high model. pipeline. reminder, the customer-centric criteria let a strategic me serve acquisition take we position

of look years. side, our--that’s businesses financial in pursue gross certainly XX% consummate attractive EBITDA capital we That’s clear rates really we and of we Nordson-like margins, expansion what and with what growth sort and five have the that cost finally. ahead of an what margins opportunities with is to deals with ROIC seven a around On for informs path that our

if platforms. and certainly financial Our and medical at pretty they test scaling you We focus strategic pipeline inspection our will that is still look provided meet adjacent our criteria. remains and position on healthy. background, technologies our Having

We them opportunities. Certainly are of on act on important and that’s based strategic remember. pursuing thoughtfully a our really financial - we’ll to criteria different number

that acquisitions confident we Fluortek, part us of million of to reminder, and Again, million example, types opened $XXX for other we have are billion $XXX another from have million our I we carve-out and gives reaching acquired about $XXX Europe, we on in company CyberOptics comment, done a ourselves for right already, feel we about target of good company NDC, the to us did We in have in thing NDC was about One was been our would of - a far, acquisitions, that million. through of towards we ability is important many deals deliver $X what all - set $XXX which XXXX. a an pipeline. now public thus so worth public deal, CyberOptics

We remain financially will disciplined. diligent and and strategically

Matt Summerville

Thank you.

Operator

Mike question Halloran line of the Your is next with Please go ahead. Baird. from

Mike Halloran

Hey, good everyone. morning

Sundaram Nagarajan

Good morning.

Joe Kelley

Mike. Morning

Mike Halloran

from. you understand seasonality talk the a I guidance like, Maybe pieces as uncertainty normal how assumes I’m very prudent, various not it’s the the in just half first about little could you’ve embedded the half. to looked bit to maybe make look the but about and front half highlighted back the you second what’s not some seasonal through looks compares Matt’s so guys are comments the you’re assumptions half want uncertainty was to around me you what understand like, like, compared I behind sure you what got coming orders far Obviously the back where saying that and had Naga, and question year. the that help thinking seasonality trends; answer moving the the about as what how helpful the of

Joe Kelley

not our growth about is The Naga, of about X.X increase did to and sales earnings given you headwind, when X% acquisition, probably guidance and so earnings of are is some headwind into benefit roughly growth the by about The To plus of X%, assumption incremental driving are margins currency those guide, currency in translates visibility expense the but as about think about. it organic this repeat, or Sure, currency is about we’re at roughly this if so around the on to this first the interest year year, X%, timing, hedge of you feel slightly so full is front of That’s in X% earnings. year. an a to think line. rates, headwind is that’s our gains, to so X% X% of on year. sales that. growth is thinking good we take mentioned acquisitions I’ll is full what full a to X.X your from half kind Mike, forecasted Interest headwind our foreign simple maybe pretty half offset flat $X.XX again, in the we impacts. accretive, the CyberOptics what’s headwind I XX%. to about the embedded the basically there’s on change coming question The the in X%, the way currency organic earnings think before, year unfavorable is to midpoint XX%

growth organic first X% consecutive visibility. growth. double-digit flat our the of the is given and half, guidance assumes with the entering just - actually backlog, second of relatively to two half growth organic so--and organic that’s is at see billion-dollar we in about look of that But at when year the We’re we years so midpoint, a X% the this following our

the you, visibility orders, half, QX it’s first and systems given of split our good the to you evenly half. in think to actually half, have would We first I second visibility tell and the not limited between about QX. backlog some When

be Year it falls that systems backlog, year, system New grown at our we QX, is be think heavier to when on much headwind in relatively nicely going last look Your have moderate QX. we’re that of and That’s FX, stay QX QX business and scheduled QX; in fell thinking that QX in When forecasted kind the know, Chinese it. we stronger delivery you Hopefully half with so back X% than about at rates. be the neutral dates, sales, to helps. customer this will at into how FX about will as to where exchange provided plus the X% you about unfavorable year has

Mike Halloran

that you delivery environment you to about what but just so orders paraphrase plays maybe quarter it that first seasonality to you’ve be the soft, quickly, feel back backlog, based then, that the interpretation? No, for good schedule maybe XQ we’ll sure was closer quarter we on the date. some got see get some To half as great. fair, you’re quick got see out normal to really not expectations and you’ve headwinds, somewhat second look the how XQ like, below Is just a very

Joe Kelley

have interpretation. second a The That’s way fair yes. given fair a the then half heavier interpretation, rates That’s FX exchange the is moved. a half, just impact in the first

Mike Halloran

is normal that get back of rate the related Then you could margins and kind in quarter impact maybe inefficiencies. the an what medical when the just for you you was mentioned the think Thanks help piece, that run think on of that that. bucket out the second you more what piece timing in are then towards segment? and the for Could

Joe Kelley

’XX. Yes Mike, $X our million I we This so impacted, the the QX, the mitigate would that which to production of profit would efficiency growth the probably approximately as due grew, ramps nice as levels move I MFS it tell reference into we negatively as and some know, and was there levels, inefficiencies. throughout, is quarter manufacturing was up half factories had XXXX, you, you, tell it look but of again tied segment, to saw--you start and the first by operating factory to XX% so to to targeted the consolidation that will in

Mike Halloran

that Great. Thanks color, everyone. the Really appreciate helpful. was

Sundaram Nagarajan

Thank you Mike.

Operator

line Allison ahead. the question with next Poliniak of go Please Fargo. is Your from Wells

Allison Poliniak

of Naga your specific end Are and normalization morning. order as or that geographies? want Just back comments lead there. I times the seeing extended some to certain in we side. that’s here. Joe, seeing good moderating to thoughts on been some any volatility go the Hi, you I driving or are have markets around to know well, bill book

Sundaram Nagarajan

you fairly lines all historic year broad-based, contribution organic full for if geographies, [indiscernible] going two said growth can Yes, our across QX and think about our business the all contribution, our be it segments, the [indiscernible]. so and years was into the same three

As end strongly backlog, so about we feel we good we have have by and different good Joe first talked about very said, general those in half, we markets, visibility.

is is kind the organic of way second revenues growth, second in flat you are XXXX. really our I is tell of this would think a best historic are on Remember, half what flat assuming. is half, I we assumptions it

Allison Poliniak

helpful. Then there anticipated. you QX, a have had any QX I stronger been versus know of I about organic QX know bit some quite maybe you shifted deliveries maybe could That’s was timing QX? into know, that was than timing talked deliveries, that but we

there, any thanks. Just thoughts

Joe Kelley

stronger QX to Yes would anticipated, pulled you a guidance tell the could was to than getting particularly contribute does Allison, as QX, side, and I that in systems opposed into came our QX, on you which perhaps that bit portion in to QX. of contribute there timing, so so a little

Allison Poliniak

Thank you.

Operator

Please from is go the Capital question Hammond ahead. Keybanc line from Markets. Your of next Jeff

Jeff Hammond

guys. Hey, good morning

Sundaram Nagarajan

Good morning.

Jeff Hammond

on versus either the electronics. softness portions it like noise, sounds in this China you the growth around can tech, advanced regulation and of Any line-ish CyberOptics? your momentum if any just I’m kind consumer-related the the emerging on finish test of know, core year, or of inspection around--you great out in to rest. or on business softness Just parse versus wondering

Sundaram Nagarajan

into business, so feel of the which still product these is would have good ATS year not overall, is and portion has grow segment in have consumer-related, it or unfavorable I a there year, think Yes, in bill our that. digit year, growth good about of some do and that we way and our inspection the as continues test inspection to about feel see it, moderation about coming We lines will book But the semiconductor. single strong our and test business it, we to business. feel good the can this, think the in dispense side momentum because both a that see all to as of is we

First of good kind half, a really is second assumption. visibility, half flattish

questions I I may regulation, of you so China missed, don’t of had any that really is that. yours. Jeff, Jeff, all of if didn’t that know there, impact see I don’t answer see you we one know terms another we we significant have piece asked, the of In today,

Jeff Hammond

on can some and think maybe that covers sales around kind great. fine-tune pieces just maybe Then give other I what pretty are expense it. of how is inform No, to moving about us it’s of range, outside range, the that’d wide, maybe the Thanks. there, the the so if uncertainty but will just guide, you range then can an increase of we the that wider be the think interest number and macro

Joe Kelley

first. I’ll ’XX. million think roughly million movements average $XX $XX interest the going maybe our expense and to Yes take ’XX Jeff, from based to on the that I powering would about rate balances interest

good pretty share would and As to in half our QX, that X%. terms we the have back I half, range, just it of organic to X% guide the sales is the QX relates first and first and visibility growth so for into go the again

good it half, starts favorable, about really half, the that--you parts the visibility we’re shorter the at to just on When and our your X%. and tell being--you particularly acquisition, X% to range, so roughly you so can unfavorable The then parts putting earnings is see a guidance as back expense a QX ship go moderate side. and pretty on acquisitions range think a again then and and know, maybe our earnings, systems half. and the consumables, and is know, and you would I in FX and will to FX relates XX% frame, entry we order and as have looking to XX% relatively appreciate flat in relatively and, to negative and organic be tight Then monitoring as the time particularly. to it’s flat that point consumables book headwind the on - systems sales QX and we is to a is the X% interest back X%, You X% first

Jeff Hammond

much. thanks Okay, so

Operator

is Please the next Connor Lynagh go Morgan Your of from question with ahead. line Stanley.

Connor Lynagh

you’re of on think you’re much and year, volume. much A question upside-downside and on of you into price and questioning that Basically, similar next have here. how then visibility can thinking help how thanks. carrying through sort line much Yes, you how similar about on us that,

Joe Kelley

about appreciate, so inflation think that pass you can with grew if in realized actions impact we so throughout price, roughly realization price, that our inflation it, took pricing you QX exited Yes, X% we through. as as XXXX then to and we

throughout we’re the first gross of next to of would half as the realization were inflation roughly given carrying the - pricing so and To half pricing volume. can split then growth year, a were Then impact half the pass organic growth, we the appreciate, to we get timing less As the diluted on as that plus All to you clearly you X% that. can a price but year-over-year we responsive. the into QX, year, and basis effective last of a impact probably that on reminder, because of had half XX% environment and will had be think dynamic on It as you would not more be your the remain as through back effective. stated simply about X%, experienced a we said, part the we year in our inflation, margins, be that percentage point, realized was of inflation. strategy

the operating we maintaining and pressures your we our change how to target, for it XX, delivered XX% be ahead XX% incremental was we we’re growth at we about think successful and margins continue actually As we’ve of the QX to and, the that’s inflation cost and in that so in to again full the of XX%, been on will manage throughout point, that organic targeting year, that. year delivered at responsive, profit we’ll which -

Sundaram Nagarajan

we’ve effectiveness, and thing XX%, add that there us increases. are very are cost managing value and increases so for in right, because pricing value that the for we things this our we value to to create it. of over remember, create for is paid get prudent we any gross we to One remember. been have, The cost paid our a allows to customers, get But you’ve couple margins to got

along tell and in relationships would are allows creating environment continue price stack is cost to I prudent, are our effective us us a their so But what in that thing you we to increases. you, to fairly value be incredible experiencing. that’s view, our our we’re do value, component know, you’re critical point see a and going structure and customers’ total we that low we this from of customer want to small cost second and certainly cost The protect being number,

Connor Lynagh

you the Yes, understood. Thank for context there.

high the higher you Just think little you--when You risking point, you certain range, end made specific can that systems low guidance bit are versus there the the is end, particularly clarifying uncertainty? lower? clarify a comment components, maybe about just thinking of through in wide end is earlier are if are just versus the of a the or there or that range just but economic driving about watching markets that broad it you sort markets the you’re

Sundaram Nagarajan

New in second growth But quarter revenue first we given that have. because very we second half, and first is and of systems historic about split think indicated reiterated, on were quarter as very Connor, well some are is a flattish range levels and visibility There we as I the have ’XX. shipments. timing as because our Year think orders of to that, assuming between the record system Joe Chinese are the way we comfortable the we the running

The albeit that one. part XX% where so. of of so MFS We is segment. understand, we year, we customer our end of are high, MFS is have inventory segment, grow our markets our we a watching from segments what fairly that small we’ve is it’s That our components, is we’ll about expect watch talked which biopharma all single digits, the two fluid to in

that one other watching to business would trends which into dispense some so incredible growth in I coming two our would the be there, we be two quarter, book some those you in that, here the ATS unfavorable years. has was past so segment, indicated What the the was had know, The bill we’re watching. see--you there

be solid, actually system pretty are nicely. to growing industrial our very Our industrial businesses seem remaining businesses

business, interventional which so. Our more levels, say, that medical medical business color. is our is should to you back I gives pre-COVID Hopefully some

Connor Lynagh

you much. thank It very does,

Operator

again, would you the number question, Once keypad. one your ask if to press a star like on telephone simply then

Your is Christopher the Please Glynn with next of Oppenheimer. from go question ahead. line

Christopher Glynn

guys. morning good Thanks,

Sundaram Nagarajan

Good morning.

Joe Kelley

morning. Good

Christopher Glynn

curious I emerging of a or kind in Was seeing trend. don’t you’re some to I lines. the that product hear if in interested have a a recall those markets call-out if question. polymer on but got quarters, vibrancy recap the call-out recent

Sundaram Nagarajan

parts us. of I biggest ago, of our part is the that team growth years, part really it in company business think liked and [indiscernible] address I a exited is we’ve really parts we test few a were it which that a remember, you of but I to it but the had and business of number years had we is business Yes, and we’re strategic business is nicely business--if not to solid in we like, had the our term liked. we so--and now and medical some the think trends, barrels some growing we where We for done a long nice our a is a certainly business [indiscernible] kept the is the growth through business, that liked leadership a of what cost parts there work this in Again, were all go team of best in good really over and part this opportunities pretty is the inspection the us and positioned that after period has a that and There so this growth I resulted there, business have number portfolio. this we and to structure issues great of a has the business growth, growing. rate. that business say place but has of reposition did taken wouldn’t a time. appreciate that’s

Christopher Glynn

healthier or trends the appetite in end different any markets? there Is Okay.

Sundaram Nagarajan

small the so. on, these base. it in I significant, pretty certainly trend around opportunities, that Again, really way manufacturing would business. be trend also [indiscernible]. it’s parts about of don’t is What good and that two film think that there doubles I bio certainly singles in EV whole is some is business, the Again, of have a to that a and customer nice battery couple plastic is they is there all recycling, a some the see materials benefiting used team it in doing--and specialty Chris. momentum say some want to is things. we this the is this is pretty but these has want to make working are team also you areas is There

the place is, you be our some think from [indiscernible] growing. teams, company and better bigger I takeaway know, incredible the reposition should leadership with

Christopher Glynn

Thank you. On ATS--or non-medical I in rather, the wanted MFS, side. at look to

it’s a couple think million. something over EFD, basically I hundred

cyclicality what how the there, are the positioned. and Just applications remind to and that’s customers want

Sundaram Nagarajan

most of it maybe growth is is is good sciences. so dispensing fluid Yes, know, a one but what electronics dispensing our the business bit strong growing Quite [indiscernible] it’s going if of also to [Indiscernible] a typically does, is--you business cycle business of it It’s diversified applications pretty it’s frankly, with little actually more wins applications, diversified. sciences. for applications applications. life part that kind a them. to life GDP electronics That

Christopher Glynn

Thank you.

Operator

for This call any does I will over comments. the now today’s of closing back turn Q&A to conclude session call. Naga the

Sundaram Nagarajan

your on call. attention today’s for time and you Thank

XXXX returns. Our core term delivering Next framework for evidenced growth revenue NBS well fiscal dynamic the tier a in leading focused margins objective you with was for capabilities environment. top our a holiday growth This we as long remain and and position achieving well. us well season. expect We to with XXXX on positions We combined it of happy us wish

Operator

This XXXX concludes year fourth for quarter all Corporation the Thank joining. fiscal call. and you Nordson conference

may You disconnect. now

Nordson (NDSN) 15 Dec 222022 Q4 Earnings call transcript