ASTE - Earnings call 4 2023 | Astec Industries, Inc.

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Operator

Hello, and welcome to the Astec Industries Fourth Quarter and Full Year 2023 Earnings Call.

As a reminder, this conference call is being recorded. It is my pleasure to introduce your host, Steve Anderson, Senior Vice President of Administration and Investor Relations. Mr. Anderson, you may begin.

Stephen C. Anderson

morning, good and you, everyone. Thank

turn today's Joining and Merwe, In then Jaco to I'll der Becky will financial are Executive me just to Officer; results. comments, moment, Officer. on Chief Financial and van Chief over our call Becky provide call the summarize a Jaco Weyenberg,

of to that safe remind and future the performance Act. liability risks, the company, Any I'll you with the this such the contained future Litigation that are statements begin, performance assumptions. news and to our we SEC. today's are Private are discussion the may can Reform relate morning statements certain are not qualify are release established to in by our our intended others these results guarantees Before harbor that highlighted in subject contain filings Factors influence for forward-looking and statements uncertainties Securities financial of and

tabs. now, Jaco. which GAAP Relations at release be the over companies. in call our related intend reconciliation isolation A we to in accepted refers considered our to in earnings factors. as I'll U.S. familiarize GAAP and ask the company which yourself to As with www.astecindustries.com does you the results, principles, those our the our regarding generally or are turn investors information provide GAAP, with that is is company's usual, effort accounting materials various Management an presentation, In substitute additional standardized And financial to and prescribed of slide non-GAAP management useful items Presentations the appendix included are no website provides to news by related company the These measures. for other to measures which of these similar non-GAAP to have measures Investor U.S. All non-GAAP believes investors. GAAP the of and be unlikely a therefore, under financial on of calculation are for not information comparable results measures, including deck. meaning to the posted

Jaco van der Merwe

enabled XX.X% from funding give were by our positive increased growing Their the business segments. are ERP Concrete federal in X and the review and demand results to implied achieve busy thank National with I execution. Good solid orders new year They our market we events We a accomplish using projects. help this for Oracle product XXXX, at year, full and we a the initiatives These an business, in will future. steady the year bill growing business. consistent, with us had we strategic parts equipment positive product with full met to sequentially. momentum I the record XXXX the Pavement able for Thank their for you, World many with particularly advance key year on complete Asphalt joining and was QX highway deliver been and was outlook and in I of in morning, new us. team remained as everyone, excellence, of during customers our the am development operational at implied profitable orders end proud and important Steve. as Astec great XXXX saw efforts our you In the Slide more very optimism, confidence by will long-term us introductions begin turn encouraged the such remain in as us has growth what year. sales demand the sentiment. combined QX, Association both to highlights. of end recent across encouraged of

A than testament apply culture to doubled and basis to margins performance the EPS year. practices. During This that us consistently adjusted XXX delivers execute a priority QX and in points XXXX, build margins. financial our and ability efficiently results. XXXX gross full was We team to for delivered expanded profitability excellence more a operational improved expanded for team's the is

that we business even to progress objective. profitability year great level have results as Our have towards higher full made continues laid demonstrated of grow. foundation the our this These for an achievements

ERP by to continues move Our forward, implementation the Oracle achieved. milestones XXXX indicated as we

will harness new the the We continue efficient drive capabilities systems enhanced and of effective operations. to to

by Guided this what customers, we this do is Lastly, like tremendous communities the to across I many and our was our to core to integrity, innovation, first our work employees in December. which a acknowledge values And effort respect report. for and of the this safety, we right we published the describes corporate by line. to would in project complete It report report strive devotion, sustainability finish hard how team get done individuals operate.

Our vision This of report that move create to we forward from provides goal inaugural life-changing foundation a is industry-changing the solutions long-term growth. build which can opportunities. sustainable with

Slide X. to Turning

past processes to the over eliminating our few years, steps and waste enhancing demonstrated productivity. As improve taken to by business we have simplify

the to to map. disciplined where customers our add to value, focused greatest and practices. on opportunities continue explore with develop plan are we our We organically acquisition to innovation working aftermarket We areas road best-in-class grow and dealers bringing a through

am like We expanded a and our notable to the achievements have X. this key journey, the the performance identified culture consistent to that past Moving create our on of same execution. basis to points target the and last to taking one After significant from gross year. built made time, XXXX into CEO we on have on role I strengthen the we priorities by minutes further and in XXXX. months, opportunities additional see take some I Slide I progress was long-term few pleased for built have highlight business embrace XXX margins by At XX as evidenced to established our year, those last to results Reflecting us achievements. goals. would a on

improve continue to innovation, We margin. and processes to invest positive deliver creating

these continue will XXXX. We efforts in

slate provide of products new enable and help us to markets needs. a investments to will us growing Additional customer better will serve solutions

was serve corporate profitable our manufacturing enable dealers XXXX here X we and drive the great ERP actions availability to One is in operating prioritized continuous These example global better enable accomplishments customers, customers. site broader implementation increased drives major offering of system The distribution an Promoting dealers continue model we product We to a of better will Oracle consistent dedication that collaboration our and a products network have at launch shareholders. to XXXX. growing modules improvement. elements enhanced the parts of the in and want customers Astec the audience customer area our launched to to market. and create as new greater out included us growth. in XXXX through these serve our and prioritizing to to of our expansion second The

have We have rates, made XXXX in as implementation and parts fill Operationally, improvements past XXXX. in plans improved for we areas which years. XX% in such additional sites X the

further recent year. our important business very to the have the injury-free injury Through make best One our every constant improve focus additional the our to want home I healthy to of our throughput and when and in team will X.XX, we team. to go industry company's compared in me day. value investments reduced to recordable continuous velocity on average. history rate favorable our steadfast is improvement, is core This and very our this We safety.

sites. and unite objectives vision will the is life-changing around continue across goal solutions zero And new to Astec industry-changing finally, to is statement, and to work opportunities. harm, will to our long-term continue build that Our we team our create which eliminate injuries

make We will together organization. greater to work even Astec an

the Turning business observations X. some would on I to dynamics. current Slide like offer to

opportunities we are for uncertain, is inventory, further Infrastructure production an a growing our equipment. remains support improving While aftermarket the demand opportunity that need Asphalt increasing there delivery end mobile parts service road In environment growth. building, Concrete closely and with macro for to our a working to dealers point strong. Dealers of the environment indicators demand Solutions with markets, number of and our additional and for stable are by

Materials we event outlook may interest signals concerns dealer For mobile term. that writing crushing the our rate on near saw screening from and in weigh heightened equipment Solutions, annual order

opportunities to are domestic and rely however, their efficiently. In moving international are new help customer forward infrastructure term, spending deliver Customers long and on our we the favorable look busy, keep groups, due releasing demand they to projects products markets. to trends us innovation to needs. in For both

indicator driving to future be increasing coverage addition are force sales direct our increased rate. markets. for from product deployed to further Contract by a essence new deploying continues which and provides future in product a leading for Funding and positive Funding bill construction. our federal introductions, sales XXXX, Federal penetrate we network Highway aftermarket expanding stability customers, at In the our demand. to our dealer awards legislation from to is X.X% growing

Slide Horizontal on was Next, new you positive our on been I were reception both and would X. in products with our Grinder in shown update XXXX, launched two have The customers. products Both of Peterson XXXXE March. met from The units to on a and launched Cold RX-XXX off number with are was unit we in this with sold margins October rental and product are The in track Roadtec for and in expectations, great is Planer forecast line XXXX. of our launched start. to like

customer success dedication. New in pleased in to normalize were the complex supply with World products more to actions presenting XXXX show X backlog require and I look chain teamwork levels product of am logistics Nashville of XXth. and new and to by continues March Asphalt the through peak XXth forward trade constraints. launches Slide on are shows caused that experienced the at that these and primarily from

investments X and progress Implied sequentially XXXX. operational year, historic Over on Slide first in made more shown we holding quarters orders have after excellence to returned QX, the the through XX.X% throughput increased to XX, patterns, in of have initiatives. through converting steady in backlog past orders sales and

Combined XXXX interest temper will our Becky While increasingly for term. healthy discuss financial with now Astec. well in one the I state am for year to growth is points positive, with to detailed double-digit backlog, infrastructure may turn were increase we results. encouraged Customer to over near industry does make the call will a that solutions not products be while full data for becoming products Solutions year that, XXXX. bode point in for road which solid new rates quarter and I our and With in fourth confident federal our and sentiment the a higher Industry orders. construction, data Material product in demand trend,

Rebecca Weyenberg

EBITDA tax basis were a was and improvements increased margins costs. and existing by The I'll with XXX.X%. $XX.X as effective SG&A higher decline international increase Sales pricing of Thank offset for points Australia in transformation which Brazil gross gross million, rate losses softer $X.XX The manufacturing more Parts release Infrastructure per by by down morning, Solutions net XX.X%. begin planned significant X.X% effective the million period by the growth $X.X The were earnings $X.XX costs year, included XX.X%, rate and sales of of fourth corresponding Slide driven XX.X%. By on XXX you, offset the and are income biggest XXXX Jaco, and of tailwinds operating quarter benefit Full Solutions of offset margins. from domestic allowances India. tax in share from current year. increasing increased Europe, an slight and prior with with last were efficiencies. of increased figure net Canada. costs. our than by decline. and a other was tax than on results sales the and Adjusted a increase we was for region, year a down EBITDA XX.X%, grew to good million equipment This Increased Overall, personnel-related valuation progress sales, more XX. $XXX.X We were XXX X.X% and in the for we're review which program in everyone. decrease driver utilization project points. this from X%, was particular basis expanded making lower quarter Adjusted margins quarter to adjusted costs excludes sales. weakness by an pleased margins was adjusted the consulting realization Material

slightly was XX. Our Fourth normalized expenses. volume, for with EBITDA year XX% than On pricing which Slide increased expansion rate from full quarter million, the and higher to plus contribution SG&A net XXX mix basis more $XX.X the estimated. was of range XX% below points adjusted from manufacturing we efficiencies inflation XX.X% X.X%. had margin to to effective the tax and impact offset The positive XX.X%,

million by Salable quarter, Infrastructure $XXX costs. net Moving gross of on offset were manufacturing points efficiencies sales net we Infrastructure international for to XXX with margin SG&A Parts to inflation, Slide XX. to as EBITDA slightly Solutions personnel were X%, and price demand. Adjusted XX.X%. Net orders by soft higher growth outpaced up were to X.X% volume parts domestic partially increased Solutions driving demand. basis aftermarket able strong for sales higher increased fulfill offset margins. positive mix this

to growth decreased and XX XX. Material By sales which X.X% impact X.X%. basis manufacturing the for domestic XX.X% adjusted due SG&A the Slide efficiencies, positive to was our EBITDA Adjusted earnings results. were XX, the reserve increase sales sales increased softer at and points infrastructure year review was both alignment even grew Slide were EBITDA million Materials $XX.X XX.X% in up of stable and mix pricing volume slightly initiatives. litigation declined margins demand. to incurred domestic $X.XXX Turning price Solutions and year. decreases Solutions full half in offset international there increased strong XXX largely to and due Adjusted as had sales, Solutions basis billion, an Materials by and second per XXX.X% the demand. X.X%. both to XX.X% points I'll gross expansion ability through down in partially On declined in were with down domestic from offset to drive lower loss XX.X% cost increases factoring growth Adjusted decreased in and net also of margins region, personnel margin International our X%, by due when and we share costs. and parts This pricing Equipment were X%. Sales EBITDA sales international to X.X%. sales

XX. highlight Slide We EBITDA drivers the key year-over-year of adjusted bridge. our to Moving

to As basis $XXX EBITDA of XX.X% with previously increased adjusted XXX million mentioned, expansion to X.X%. EBITDA an points

mix headwinds from than higher seen the and As impact more in positive chart, net pricing the inflation offset costs. of SG&A volume

We long-term fruition, pricing our margin expanded deliver to are shareholder drive proud realization has value. increased and to factory come we of investments expect to the as EBITDA and strong

XX. Slide to Turning

compared cash of Our flow improved we million. cash and of stood our equivalents $XXX.X use million This improve of and generated in was operating $XX.X working million a year, $XX.X capital. $XX.X of to earnings prior to cash at turnaround took cash million. the due We the steps with difference

positioning growth end XXXX, us balance up profitable liquidity from Our slightly a continue the still while is strong sheet. of to initiatives investing maintaining in

of growth We million. with our range direct a the the This previously to back to $X.X over the it now that, million We communicated. fourth investments to Turning returning CapEx Slide $XX.X capital maintain We XXXX on will dividends turn to return continue With were pleased XX. year cash best disciplined million during to shareholders. is deployment in we bringing to to full create balancing framework, shareholders $XX.X in within Jaco. capital returns. spent in CapEx the form to I as quarter,

Jaco van der Merwe

even I Slide by on in Thank XXXX can you, teams We during closing, closed our results Becky. In deliver fourth delivering the quarter. XX. strong better confident am XXXX. results

enhanced employees delivering for and our and are dedication ready and that, With I to to grateful way and open our call am for We for we questions. have we work hard on their are do, customers but yet performance to to loyalty customers our the to shareholders. for work support. well their now operator, our

Operator

Your Instructions] Steve the BB&T. first question [Operator line from is Ferazani of with

Steve Ferazani

margin higher we Is the around This is Steve. little to bit or other higher margins? Can start pricing led sales that Alex for color a what's factors? by of on providing or

Jaco van der Merwe

the Like us that we in strong quarter. regards mentioned typically seen parts favorable QX Yes. a We've Alex, definitely this to Jaco. is mix. calls, quarter earnings with previous is for during

but on it's parts performance our around one We lot point And of facilities. from you effect a positive to performance. done thing, on done Infrastructure we difficult have operational lot bridges, work investing quarter. you've a have Solutions And then every and our inflation. seen teams as versus in our strong work a And excellence know the getting narrower of obviously We've to also our had a is effect pricing that by team.

So other to closer we to each definitely, expect coming as year, well. for much that move the

Steve Ferazani

turn Could about a trends if improvement particular follow-up seeing little backlog? a and me. order areas towards positive you talk And for bit or you're within movement a rate the of

Jaco van der Merwe

there's comes we that and When backlog, to of at. Yes. couple a it ordering looking factors are

I've As already year at Global the this the had many to National and remarks, speak customers in prepared opportunity Association. mentioned Asphalt to Concrete, Pavement

positive. customers busy, is sentiment Our are

improved are flow that the from We products obviously busy new seeing now. And mentioned hitting right federal the funding. we release of is market

And year But are a On of up and The we that, being year, affecting a a crushing be mobile the order mostly and down us. orders obviously, in little screening this side obviously, that this here for going opposite view. believe an implied signal. from positive always interest year, overall, an equipment. rates that election bit of we QX of jumped to then year expect is stable was point our

we So expecting single-digit to XXXX. flat are for growth

Steve Ferazani

And last little those timing Great. improvements -- a developed. from question margin plant and ERP. of we about the the you as mentioned talk of might Could is for some I'm bit me. curious more implementation But efficiency you've the see

Jaco van der Merwe

Yes.

So just on a it whole, various comes places. as from margins

are And our Astec advantage now in taking continuously now are together saw last are year, mentioned can of obviously, continuously organization. One nicely, team, of our they delivering having quite excellence. facilities. last as the bit the with really inflation already across on And the couple the definitely We we that we quarters. and Astec we pricing of CapEx parity. are effect. coming size working procurement an We And now operational Those in see our invested a you

all are So those contributing.

live On year. last ERP one side, we specifically, on site the went

have will specifically We XXXX. that here will live in sites sites go have two QX. we various will that during And go

future work a of shorter that that margins. positive with help have already to effect But quarters. done term, we the of lot for a see good the teams those in So expect should there's

thing factories big have think always job a to I based view, on processes comes our resources consider are a of now level improved for planning our when from we to the I doing level. it good are of to one item good And to that operations point teams absorption. think plan also sales really having margin in a work consider with and

visibility appropriate well products, So take we certain On now positioned market continues market the the to good strong, we to take are down, can teams that if advantage that. have of turns the be if actions. that

Rebecca Weyenberg

Yes. Jaco, that's in a a play is been last program sites coming one close. well. reminder that transformation of I might years to our to the a like as had significant We add X Chattanooga, with to and

We are here. year, putting program that the And is then the of perfect to end and And the they'll final launching as as stabilize. then the QX the detail, remainder far continue which in of that's investment. throughout

And forward, improvement from expect the margin to impact the investment to we in going back it and just of do so that year continued will then grow. continue half us

had which calling progress, is finish The our specifically making but still expansion other our that what in will in is XXXX. in Omagh we're in to capital we're Northern is gateway their major investment Europe. also And facility a facility Ireland. We to

So back they of be we year the in will the into new in will and half the once room, facility and launching have be products several XXXX. that that

from opportunity we see EBITDA gross margin, increase So our our margin portfolio. investments and do to margin our

Operator

Your Mig comes Dobre with from R.W. next line question Baird. the of

Joseph Grabowski

The ask was wanted maybe several margin been of Mig in margin but on margin, highest was Material past between out it's XXXX. about but Grabowski it's been also infrastructure Solutions for the morning. than it It's to years, kind in EBITDA softer segments. the I quarter Joe this EBITDA split

I of segment. So Material kind kind of flowing in not Becky, but is margins you it, in Solutions? infrastructure talk is maybe about by touching that upon of just through working maybe kind And were what know

Jaco van der Merwe

stop make I a that. Joe, could at Yes. first

a You're absolutely performance. had Solutions right. really Infrastructure strong

specifically year. If is you strong as a quarter part look QX at be that QX this very group will

selling. in plants the Asphalt have efficiencies really So part and we're We've around driving our influence. -- obviously the also plants and was a positive Concrete well that teams done

have heard and that. on talk the around in doing modularization You guys past the we're us work

will outcomes last done and have X the that And that. team, Infrastructure team has X, a the So on obviously that of to we're the also very now what on Material will new the we had created But on a execute. say now side, over enough I we've duplicate see that rational we we've Solutions years, side, starting strong that leader to side. Solutions time

interest effect procured side seen rates Solutions more significant the customers definitely a on have to specifically of with We the converting Material the not units having business, rental units.

versus equipment. of thing our a carrying the are are at customers our those that good fleet rental dealers running is So leases. end the The bigger converting

not running. that are have standing. we it's So They equipment

a So have we're dealer as around those convert basis as our soon to And they agreements, with purchase starting will that inventory. dealers daily to having are our to discussions replenish that. network rental obviously on

Joseph Grabowski

Got it.

question sales. you're Okay. would Can business? international the international quarter, the you I XX% in My on down seeing year-over-year. what guess, million be, talk the $XX next about of side

Jaco van der Merwe

And Yes. will timing. that more a I of was big piece say

soft. is Europe obviously, So

I think you've heard the industry. multiple people that from in other

big soft, have And part an that and through look view, at not is a you pipeline international of point So from transit was year should quoting have our we customers, flow equipment Europe although our funnel. in to pipeline is our strong pieces business. in of actually, QX. various But a those we if of very international Europe and

in think last international we investment over pipeline So will the side. shown have, years be few the our XXXX international that we improvements have stronger our on actually, the and with strong I organization that believe

Joseph Grabowski

it. Got

final me. And upon the you touched Okay. program. for question Becky, transformation

in the $XX of XXXX. $XX XXXX, and in charges think about you is And all XXXX in you charges? program of I what what will Maybe million talk kind expect be beyond? do just million transformation had those charges in

Rebecca Weyenberg

absolutely. Sure,

that lift our expect The but of a conclude programs, The the transformation lighter we sites. spending rollout with same XXXX do and as two entities in majority manufacture I program, So largest forward. and in the we international then go there sales of at the are transformation such, products we'll of as all program and we range mentioned. of 'XX all facility to will expect 'XX And is this sites kind that as the with our concluding do here Chattanooga was be year. those continue to

so for forward. QX and has one at remainder And that tied the The is remind I'll finished of is purposes it's all those transformation more that And won't going to of an our -- we so the everyone, Oracle have ERP. intents than that charges end rollout. just

So different site it is disparate company. -- flavor, in a missing had really everywhere had systems we we were but the Every some fundamental basics.

So We a tool ERP, management management human we a rolled customer we out corporate rolled a capital and transformation system system. tool, and rolled a relationship our doing out out management consolidation program. we're

of but we management. have that And a quite it went in we lifts the capital effective manufacturing efficient at excited because we because about then and 'XX. already few more human all And heavy end went facility seeing So the live it will we and U.S. of conclude are pretty we're operations there, corporate.

mean, really the we're the the and of the us getting, future efficiency. up that's data, quickness profitability I information accuracy So setting information, the of for

Operator

with next is the Larry of William Blair. Maria line question Your De from

Lawrence De Maria

little Materials the kind considering secondly, dealer Material of out backlog Solutions bit do obviously versus segment? But orders term. Solutions, you then can a how weak did And break by it's near event. expectations

and Did we split maybe $XX if orders $XX Or talk we were a Segment? that backlog think million to Is relevant? that order of about I out million that there. hit expectations you by the number? for looking just

Jaco van der Merwe

in the expected, Solutions a full We what had event. came The a Larry. at value million. quite Intel bit take lighter $XX we about Yes, I'll start than

Now explained in X this I not year from biggest to will X that our of had what converting procurement. that or earlier, due program that rental not to say dealers participate we we did equipment

discussions with right those equipment. having are dealers customers using are We now,

actually take So couple in here months. might we right place thing that -- the we expecting of next some of to

expecting quite XXXX. came you companies those of yes, So bit at look lighter, strong the it but And using all pretty of are still in are the reports material crushing customers if space, companies out a a equipment.

So feel issue, that a getting our need support more working we is customers. timing they continuously this and comfortable on their of we're dealers what to with

what segment. Material last we both Sequentially backlog in out biggest were percentage a from Solutions obviously, less saw typically the previous in by years. quarter, it the potentially that with On in we break view. expect point what in we was the segment. here fully more don't But think reduction or QX. same percentage be will But expect I to compared last above the QX reduction bookings by and be line year of year-over-year that

Operator

Your Brian the Instructions] [Operator from next line question Funds. with Gabelli of Sponheimer is

Brian Sponheimer

all the the call. color appreciate I on

million that at backlog your it's in talk a almost question and really here, maybe ago, about pricing what a ability is defend backlog. the to as that margins relative we're and imputed backlog that looking $XXX or If normalized? pricing million in imputed maybe million or and there to a Just year ago what million $XXX to seen backlog year $XXX in you $XXX you've compares and about could

Jaco van der Merwe

in backlog. very will that Yes. we our Brian, are the say we confident I pricing have in

job think bit a the jumped after I that our guard with quickly. off bases up teams being exceptional caught an first inflationary that did year

we any We've pricing that. already implemented confident expectations also inflationary about to offset feel XXXX. So for

Brian Sponheimer

any mechanisms in that potential there? within inflation you and to are for backlog, case So adjust the outlook there what changes pricing, is

Jaco van der Merwe

was not the signing pricing And reason much. do the why was what typically lagged ago, so years our contracts deal. X have adjustment inflationary inflation We in that a an of post it

pricing I future deliveries. think have to oligo proactive for more been and much teams inflation anticipate the

Brian Sponheimer

a about you quarters is If we're quarter And infrastructure a here. went to that. decent the year point where in a with XXXX, drive Talk from where can third down. ability relative your some is obviously, If XXXX thinking challenge. ago. starting thinking I to year I'm about profitability perspective profitability maybe a to in in up materials help is Becky, maybe, appreciate year, how was start the about

Rebecca Weyenberg

seen expect Certainly, softness that MS that don't Certainly. we've we some continue. in to

We are house, the seeing sales. fact of part are infrastructure that that back. signs that, solutions will our comes And come largely we side on the of that from direct

on can same can pretty have from same at the not I the internally the we pressures come some kind we customers maybe banking most have year. see. can expect think that next But large They rates. storms quarter dealer If certainly, we Certainly, if to -- sales on but that these we channel, interest X we will But don't network pleased then know from come customers gross to we X confidence be that's than that little than now, XX% rentals wait of do, give So our we or seeing happens, that to to we're rates says single more pressures pressure. QX. these Right but as our more I inventory. can, read our we they'll able pretty we that we and bit above some do have that set margin, this but cuts a don't side. the where And same interest some can were and they're and carry want happens, had that dealer it, better year, saw we're the everybody what every see as convert. in if down, weather

X.X%. EBITDA bit gross out. in pretty finishing as feel forward. margins that invested to confident year, expand our rolling capital a year on very if that get We're margins quite sales, going strong we well and we programs we at both this profit the grew So can runway also have return the we're our The as

money know sure So our and make that that metrics our hit they we're very that with on, we tracking we approval. spending we're programs for well

quite bit see do opportunity. well. we this as And a mentioned Jaco of So

our is have The in parts parts fill our third gives increase ability backlog. should point other confidence that us We rates. to never

backlog. drop our of part is in that So

part turning to A XX are that's regular an of satisfy not the customer equipment, we're progress possible. to little if equip bit hours at to but have good We there, We in want routine. but very where when orders a be. manufacture longer want we seen we older we've something

us to give should So some we'll and on room continue that expansion. focus also that, for

Jaco van der Merwe

the in a an get just manufacture stability of for we if comment Maybe here. we on we operationally, Jaco it's that This way I sales, year, additional say, the have pricing. us, Brian, we now feel lot will that.

to So an that if are there sales the is development. profit upside we there, feel

time teams So positively of the the to we're done work show up. if materialize business, we've with pipeline sales. and that our effort the all that create our And consistency spending the in we of future should sales more fill lot to a up in because

Brian Sponheimer

one, appreciate that. I if last guess I one you'll allow.

continuing idea kind fix it for that sheet Is you shape. baseline -- looking you go. here? How using what's -- what the cash think profitability in great With to set Balance is do acquisitions? of for just Is buyback? going where a to it about You're fixing is

Jaco van der Merwe

No, Good Brian. question. Yes. good question,

facilities. a So capital our of couple we allocation in from point want to CapEx, have still things of there's a the view, that invest on Obviously, table. we

So be we'll And with the we then going million is $XX continue $XX to CapEx dividend. range. think that in million,

our find all plan if down done the opportunities. today. last to debt pay we that are past will just company, job the I have a it a The we our way things because right point program year, make just teams we an we the revolver at volume significant And us just that. the think than on sure that consider this drive give not pipeline. inventory will year this good have filling of view, looking really want we'll teams And future acquisition fund But have current working design. our open other definitely is we on the we inventory. on to designed. I also definitely million. mention that and are obviously down it was From buyback, do under buyback if start $XX a Even do program about we of

accounts say in best been long you will shape time. the I in a it's have it's look our receivable, teams the that there, at done payable work accounts If

capital So lot us. our a around work of and a Iberis is that driving a for ROIC using in focus good way in big that

Brian Sponheimer

All and turnaround Much from right. QX on appreciated congrats good a Great. here.

Operator

follow-up De a the is question next Blair. from William of line with Larry Your Maria

Lawrence De Maria

disconnected got I before.

in for You margins noted the, obviously, a gross the big increase year.

parts. XQ. in 'XX, XX% to program and growth at up to to sales I above look benefits, up 'XX flat 'XX, We think XX.X% in obviously Mason

So Is in that gross not to XX% why? shouldn't if margin XX% that not, fair? imply 'XX. Or

Jaco van der Merwe

talked closely that that watching are doing new parts the absorption. very we're Yes. are I control the good will question. items further I the We releasing, around have we driving we definitely work making business, products we various on factories that on, that's is our about working item good Larry. No, that sure the a have procurement. are we say in

development. a the goods on of So timing all but margins will to we margin lot that we're are thing it when around hit, expecting working on, continuously positive momentum It's there's a improve. exactly definitely just

Rebecca Weyenberg

I that at from we're our Oracle. teams positive But positioned. expansion. cautionary do where down. factories I We're are live really Larry, we're point and on about the going that we're live sites with driving have just might leadership The all at Yes, add. it really margin go because we several this our that to top great confident are going board in are are mean,

as from are margin an we be a certainly XX% could our improve, So should if we goes with expecting here planned, expect to range anywhere uptick everything but XX.X%. that to

Operator

hand I'd no Steve in back There questions Anderson remarks. call for to are to the queue. further closing like

Stephen C. Anderson

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Operator

teleconference. and your Ladies you conclude participation. gentlemen, Thank for does this today's

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

Astec Industries (ASTE) 28 Feb 242023 Q4 Earnings call transcript