Axalta Coating Systems Ltd (AXTA) 2023 Q2 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to Axalta's Second Quarter 2023 Earnings Conference Call. (Operator Instructions) Today's call is being recorded, and a replay will be available through August 9. Those listening after today's call should please note that the information provided in the recording will not be updated, and therefore, may no longer be current.

女士們先生們，感謝你們的支持。歡迎參加艾仕得 2023 年第二季度收益電話會議。 （操作員說明）今天的通話正在錄音，重播將持續到 8 月 9 日。今天通話後收聽的人請注意，錄音中提供的信息不會更新，因此可能不再是最新信息。

I will now turn the call over to Chris Evans. Please go ahead, sir.

我現在將把電話轉給克里斯·埃文斯。請繼續，先生。

Thank you, and good morning. This is Chris Evans, VP of Investor Relations. We appreciate your continued interest in Axalta and welcome you to our second quarter 2023 financial results conference call. Joining me today are Chris Villavarayan, CEO and President; and Sean Lannon, CFO.

謝謝你，早上好。我是投資者關係副總裁克里斯·埃文斯。我們感謝您對艾仕得的持續關注，並歡迎您參加我們的 2023 年第二季度財務業績電話會議。今天加入我的是首席執行官兼總裁 Chris Villavarayan；和首席財務官肖恩·蘭農 (Sean Lannon)。

Yesterday afternoon, we released our quarterly financial results and posted a slide presentation to the Investor Relations section of our website at axalta.com, which we will be referencing during this call. Our prepared remarks, the slide presentation and our discussion today may contain forward-looking statements, reflecting the company's current view of future events and their potential effect on Axalta's operating and financial performance.

昨天下午，我們發布了季度財務業績，並在我們網站 axalta.com 的投資者關係部分發布了幻燈片演示，我們將在本次電話會議中參考該幻燈片。我們準備好的發言、幻燈片演示和今天的討論可能包含前瞻性陳述，反映了公司當前對未來事件及其對艾仕得運營和財務業績的潛在影響的看法。

These statements involve uncertainties and risks, and actual results may differ materially from those forward-looking statements. Please note that the company is under no obligation to provide updates to these forward-looking statements.

這些陳述涉及不確定性和風險，實際結果可能與這些前瞻性陳述存在重大差異。請注意，該公司沒有義務提供這些前瞻性陳述的更新。

Our remarks and the slide presentation also contain various non-GAAP financial measures. In the appendix of the slide presentation, we've included reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures.

我們的評論和幻燈片演示還包含各種非公認會計準則財務指標。在幻燈片演示文稿的附錄中，我們將這些非 GAAP 財務指標與最直接可比的 GAAP 財務指標進行了調節。

For additional information regarding forward-looking statements and non-GAAP financial measures, please refer to our filings with the SEC.

有關前瞻性陳述和非 GAAP 財務指標的更多信息，請參閱我們向 SEC 提交的文件。

I will now turn the call over to Chris.

我現在將把電話轉給克里斯。

Thank you, Chris. I would like to welcome everyone to our second quarter 2023 earnings call. Let me begin by thanking Sean for his decade of service to Axalta. As you're aware, we recently announced that he is leaving the company to pursue another opportunity. Sean has had many notable accomplishments during his time with the company and was instrumental in building the foundation of an exceptional finance organization. I'm especially grateful for his partnership during my first 7 months as CEO of Axalta. On behalf of the entire Board, thank you, Sean. We wish you well in the future.

謝謝你，克里斯。我謹歡迎大家參加我們的 2023 年第二季度財報電話會議。首先，我要感謝 Sean 為艾仕得服務了十年。如您所知，我們最近宣布他將離開公司去尋找另一個機會。 Sean 在公司任職期間取得了許多顯著成就，並為建立卓越的財務組織奠定了基礎。我特別感謝他在我擔任艾仕得首席執行官的頭 7 個月內的合作。我代表整個董事會，謝謝你，肖恩。我們祝您未來一切順利。

Effective August 14, Carl Anderson will be joining Axalta as our new Senior Vice President and Chief Financial Officer. Carl was most recently CFO at XPO, one of North America's largest freight transportation providers. Prior to that, he and I worked closely together at Meritor, where he also served as the CFO for more than 3 years following other key leadership roles in finance, treasury, tax, investor relations during his 16 years with the company. Carl has decades of corporate strategy and financial leadership experience in the global industrial and automotive sectors. As we strive to grow shareholder value at Axalta, Carl's background leading a finance organization through a strategic transformation and his track record as a true partner to the business leaders will be invaluable. We look forward to him joining us mid-August and appreciate that Sean will be staying a few weeks to ensure a seamless transition.

自 8 月 14 日起，卡爾·安德森 (Carl Anderson) 將加入艾仕得，擔任我們新的高級副總裁兼首席財務官。 Carl 最近擔任北美最大的貨運提供商之一 XPO 的首席財務官。在此之前，他和我在Meritor 密切合作，他還擔任了3 年多的首席財務官，並在該公司工作了16 年期間在財務、財務、稅務、投資者關係方面擔任過其他重要領導職務。 Carl 在全球工業和汽車領域擁有數十年的企業戰略和財務領導經驗。當我們努力提高艾仕得股東價值時，卡爾領導金融組織進行戰略轉型的背景以及他作為商業領袖真正合作夥伴的記錄將是無價的。我們期待他在八月中旬加入我們，並感謝肖恩將留下幾週以確保無縫過渡。

In addition, we're delighted to welcome Kevin Stein to the Axalta Board effective September 1. Kevin has served as the CEO of TransDigm Group, a leading global designer, producer and supplier of highly engineered aircraft components since 2018. He brings a wealth of experience leading global industrial businesses and holds the PhD in inorganic chemistry. His track record in growing and creating value at companies will be a true asset to Axalta.

此外，我們很高興歡迎Kevin Stein 加入艾仕得董事會，自9 月1 日起生效。Kevin 自2018 年起擔任TransDigm 集團的首席執行官，該集團是全球領先的高度工程化飛機零部件設計、生產和供應商。他帶來了豐富的經驗擁有領先全球工業企業的經驗，並擁有無機化學博士學位。他在公司成長和創造價值方面的記錄將成為艾仕得的真正資產。

Let's move to Slide 4, where I will cover the highlights of the quarter. Our second quarter adjusted EBIT was $155 million and adjusted diluted EPS of $0.35. Earnings were within our guidance range despite ERP-related operational issues in North America, a modestly softer industrial market environment and exchange losses from hyperinflationary impacts in Turkey and Argentina. Given these items and the costs associated with our productivity investments, we have demonstrated considerable underlying earnings and profitability improvement year-over-year as well as sequentially.

讓我們轉到幻燈片 4，我將在其中介紹本季度的亮點。我們第二季度調整後的息稅前利潤為 1.55 億美元，調整後的稀釋後每股收益為 0.35 美元。儘管北美存在與 ERP 相關的運營問題、工業市場環境適度疲軟以及土耳其和阿根廷因惡性通脹影響而造成匯兌損失，但盈利仍在我們的指導範圍內。考慮到這些項目以及與我們的生產力投資相關的成本，我們已經證明了同比和環比顯著的基本收益和盈利能力改善。

Net sales improved 5%, driven by strong pricing across all end markets and substantial growth in our Mobility Coatings business. Our focus on price-mix was evident again this quarter with a 7% increase year-over-year. As a result, we are seeing steady margin improvement. It is essential that we continue to prioritize more attractive returns in every end market and product category. Therefore, pricing will remain an active area for us even as we start to see the initial benefits of modest raw material deflation.

由於所有終端市場的強勁定價以及我們的移動塗料業務的大幅增長，淨銷售額增長了 5%。本季度我們對價格組合的關注再次明顯，同比增長 7%。因此，我們看到利潤率穩步提高。我們必須繼續在每個終端市場和產品類別中優先考慮更具吸引力的回報。因此，即使我們開始看到適度的原材料通貨緊縮的初步好處，定價仍將是我們的一個活躍領域。

Free cash flow of $99 million was a good result and much improved versus the prior year. This is an area where our productivity efforts are generating early wins as we rightsize the inventory balances from historically high year-end levels. This improvement in cash flow is strengthening our balance sheet, one of our highest priorities, and for the second consecutive quarter we have voluntarily paid down an additional $75 million in principal of our term loan. Given improved visibility heading into the second half of the year, we have provided a 2023 guidance framework. This guide reflects an expected improvement in second half earnings versus the first half and puts us on a full run rate to exceed pre-COVID earnings levels.

自由現金流達到 9,900 萬美元，這是一個不錯的結果，比上一年有很大改善。隨著我們從年終歷史高位調整庫存餘額，我們的生產力努力正在這一領域取得早期勝利。現金流的改善正在加強我們的資產負債表，這是我們的首要任務之一，並且連續第二個季度我們自願額外償還了 7500 萬美元的定期貸款本金。鑑於下半年能見度的提高，我們提供了 2023 年指導框架。該指南反映了下半年盈利相對上半年的預期改善，並使我們的盈利水平全面超過新冠疫情前的水平。

My main focus since joining Axalta has been to drive improved efficiency and performance across the portfolio of businesses. This past quarter, we kicked off the launch of a significant upgrade to our ERP system, which sets us the foundation for supply chain and pricing intelligence, among other attributes.

自從加入艾仕得以來，我的主要關注點是提高整個業務組合的效率和績效。上個季度，我們啟動了 ERP 系統的重大升級，這為我們的供應鍊和定價情報等奠定了基礎。

Second, the further acceleration of a purchasing optimization program meant to address recent cost inflation, derisk the supply base and reduce variable cost volatility. We expect this to provide substantial benefits, which will start to be realized in the fourth quarter.

其次，進一步加速採購優化計劃，旨在解決近期成本通脹問題、消除供應基礎風險並減少可變成本波動。我們預計這將帶來巨大的好處，並將在第四季度開始實現。

Third, a supply chain enhancement program to improve planning, throughput and working capital utilization. This work enabled us to drive down inventory and increase our free cash flow for this quarter. And finally, we also have a group looking at areas where we can optimize the structure of the company to enable us to be more responsive, resilient and profitable. We will begin to give you more detail about these programs as we execute our plans and begin to see tangible benefits later this year.

第三，供應鏈增強計劃，以提高規劃、吞吐量和營運資金利用率。這項工作使我們能夠降低庫存並增加本季度的自由現金流。最後，我們還有一個小組正在研究可以優化公司結構的領域，以使我們能夠更加敏感、更有彈性和盈利。當我們執行計劃並在今年晚些時候開始看到切實的好處時，我們將開始向您提供有關這些計劃的更多詳細信息。

As we indicated last quarter, these programs require considerable investment. The ERP-related costs will step down in the third quarter. Others, like the consulting spend, will continue through the year-end but much more muted than the second quarter as initial fixed cost investments begin to be offset with the realization of the benefits. This dynamic is reflected in our Q3 and 2023 guidance frameworks. I believe these initiatives are attractive investments in that they have short-term payback and accelerate our strategic goals.

正如我們上季度所指出的，這些計劃需要大量投資。 ERP相關成本將在第三季度下降。其他支出，如諮詢支出，將持續到年底，但比第二季度要溫和得多，因為初始固定成本投資開始被效益的實現所抵消。這種動態反映在我們的第三季度和 2023 年指導框架中。我相信這些舉措是有吸引力的投資，因為它們具有短期回報並加速我們的戰略目標。

Please turn to Slide 5 for more detail on our ERP implementation. An ERP upgrade was needed to replace an inefficient 25-year-old legacy system. This implementation has been planned for years. Globally, we have been evolving from 6 ERP systems to 1, and in doing so, we will be eliminating hundreds of applications, improving data redundancy and minimizing the need for costly manual interventions. We believe this system will significantly reduce our complexity and provide real-time insights into supply chain and pricing management.

請參閱幻燈片 5，了解有關我們 ERP 實施的更多詳細信息。需要對 ERP 進行升級，以取代已有 25 年曆史的低效遺留系統。這一實施計劃已進行多年。在全球範圍內，我們已經從 6 個 ERP 系統發展到 1 個，在此過程中，我們將消除數百個應用程序，改善數據冗餘並最大限度地減少昂貴的人工干預的需要。我們相信該系統將顯著降低我們的複雜性，並提供對供應鍊和定價管理的實時洞察。

We went live in May with a North America launch that included 11 plants and several distribution centers. Despite comprehensive preparation, the scope and complexity of this launch led to some operational issues, primarily centered in our large Refinish manufacturing site. Yet we ended the quarter on a very strong note operationally and commercially. June was one of the strongest sales months in history for North America. As such, we believe the operational issues are now substantially behind us. Despite the near record month we had in June, the operational issues limited our ability to fully deliver on customer demand in May, which resulted in sales shortfall for the quarter. We're now working to normalize the elevated backlog in the second half of the year.

我們於 5 月份在北美推出，其中包括 11 家工廠和幾個配送中心。儘管準備充分，但此次發布的範圍和復雜性導致了一些運營問題，主要集中在我們的大型修補漆製造基地。然而，我們在運營和商業方面都以非常強勁的表現結束了本季度。六月是北美歷史上銷售最強勁的月份之一。因此，我們相信運營問題現在已基本過去。儘管我們 6 月份的業績接近創紀錄的月份，但運營問題限制了我們 5 月份完全滿足客戶需求的能力，從而導致該季度的銷售短缺。我們現在正在努力使下半年積壓的情況正常化。

Given the magnitude, I consider the implementation a success. We needed to launch the system and begin operationalizing the tool. In doing so, we gained valuable learnings, including insight into effective change management, that gives me greater confidence for our remaining global implementations. I want to thank the team for their tireless work to stand up the system and manage the myriad of new processes to deliver a solid quarterly result.

鑑於其規模，我認為實施是成功的。我們需要啟動系統並開始運行該工具。在此過程中，我們獲得了寶貴的經驗，包括對有效變革管理的洞察，這讓我對我們剩餘的全球實施更有信心。我要感謝團隊的不懈努力，以建立系統並管理無數新流程，以交付可靠的季度業績。

Moving back to the results on Slide 6. Let me elaborate on our second quarter volume performance. Globally, volumes declined by 4% year-over-year as growth in Mobility Coatings was offset by declines in Performance Coatings. We estimate that the operational issues we encountered had an estimated 2% to 3% negative impact on consolidated volumes, predominantly impacting our Performance Coatings segment. Mobility Coatings volume increased 13%, supported by improved light vehicle and commercial vehicle production rates as well as previously discussed customer wins. Performance Coating volume declined by 11% due to weak industrial markets and a lower Refinish volume primarily related to our ERP launch. China was the bright spot in the quarter as volumes increased 26% and driven by light vehicle and the reopening of the local economy.

回到幻燈片 6 上的結果。讓我詳細介紹一下我們第二季度的銷量表現。全球範圍內，由於移動塗料的增長被高性能塗料的下降所抵消，銷量同比下降了 4%。我們估計，我們遇到的運營問題對合併銷量產生了約 2% 至 3% 的負面影響，主要影響的是我們的高性能塗料部門。得益於輕型汽車和商用車生產率的提高以及之前討論的客戶贏得的支持，移動塗料銷量增長了 13%。由於工業市場疲軟以及主要與我們的 ERP 啟動相關的修補漆銷量下降，高性能塗料銷量下降了 11%。中國是本季度的亮點，在輕型汽車和當地經濟重新開放的推動下，銷量增長了 26%。

Let's move to Slide 7 for more detail on our Refinish end market. Refinish net sales improved by 6% in the quarter. Price-mix was very strong and improved by 10% year-over-year, supported by a blend of carryover and new pricing. Refinish volumes declined by 8% year-over-year largely due to operational delays in North America as we saw stable underlying demand. Refinish market activity was largely consistent with the prior period. We see opportunity to grow market share and expand into adjacent markets.

讓我們轉到幻燈片 7，了解有關修補漆終端市場的更多詳細信息。本季度修補漆淨銷售額增長 6%。在結轉和新定價相結合的支持下，價格組合非常強勁，同比提高了 10%。修補漆銷量同比下降 8%，主要是由於北美地區的運營延遲，因為我們看到穩定的潛在需求。修補漆市場活動與上一時期基本一致。我們看到了增加市場份額和擴展到鄰近市場的機會。

In premium customer segment, we have over 850 new premium body shop wins year-to-date. In mainstream and economy, growth has been solid with over 200 new distribution points. This quarter, we launched Irus Mix, a fast, efficient, fully automated and completely hands-free mixing machine for the automotive refinish industry.

在高端客戶細分市場，今年迄今為止，我們已贏得超過 850 家新的高端車身維修店。在主流和經濟領域，增長穩健，新增 200 多個分銷點。本季度，我們推出了 Irus Mix，這是一款適用於汽車修補漆行業的快速、高效、全自動且完全免提的混合機。

Irus Mix is a great addition to our productive single-visit basecoat and industry-leading digital color management process. It is built on decades of innovation from award-winning spectrophotometers and AI-based color match software. With Irus Mix, customers benefit from high-speed mixing and enhanced body shop productivity that completely eliminates the need for manual mixing, accurate color matching every time, simple to use automated operation, which frees up painters to do other jobs while paint is being mixed, and finally, an environmentally thoughtful design that utilizes 50% recycled plastic and reduces waste by delivering every last drop of paint.

Irus Mix 是對我們高效的一次性底漆和行業領先的數字色彩管理流程的重要補充。它建立在屢獲殊榮的分光光度計和基於人工智能的配色軟件數十年的創新基礎之上。借助 Irus Mix，客戶可以受益於高速混合和增強的車身車間生產力，完全消除了手動混合的需要、每次準確的顏色匹配、易於使用的自動化操作，使油漆工在混合油漆時可以從事其他工作最後，採用環保設計，利用50% 的再生塑料，並通過提供最後一滴油漆來減少浪費。

In June, we launched Irus Mix commercially in Europe, and we expect to serve the rest of the world beginning 2024. Early customer feedback has been incredibly encouraging. The order book is exceeding our projections with first deliveries beginning in August. Our success is predicated on remaining the most innovative solution provider in the industry. Irus Mix expands our competitive differentiation and deepens our customer-centric ecosystem. When Axalta Irus is paired with our single-visit application system, no one has a faster, more productive, end-to-end process. This is why we believe we will continue to win and grow in Refinish.

6 月，我們在歐洲推出了 Irus Mix 商業版，預計從 2024 年開始為世界其他地區提供服務。早期的客戶反饋非常令人鼓舞。訂單量超出了我們的預測，首批交付將於八月開始。我們的成功取決於我們仍然是業內最具創新性的解決方案提供商。 Irus Mix 擴大了我們的競爭優勢，並深化了我們以客戶為中心的生態系統。當艾仕得 Irus 與我們的單次訪問申請系統配合使用時，沒有人能夠擁有更快、更高效的端到端流程。這就是為什麼我們相信我們將在修補漆領域繼續獲勝並不斷發展。

Moving to Slide 8, I will now cover the Industrial business. Constant currency net sales decreased modestly in the quarter as very strong price-mix growth of 7% year-over-year was more than offset by a 15% volume decline. Volumes were better in Asia Pacific, but this was more than offset by double-digit declines in EMEA and North America, due largely to the construction market slowdown. Yet, there is encouraging signs of stabilization as bookings in the second half appear modestly stronger than the first half rate.

轉到幻燈片 8，我現在將介紹工業業務。本季度按固定匯率計算的淨銷售額小幅下降，價格組合同比增長 7%，但被銷量下降 15% 所抵消。亞太地區的成交量較好，但這被歐洲、中東和非洲和北美的兩位數下降所抵消，這主要是由於建築市場放緩。然而，隨著下半年的預訂量似乎略高於上半年，出現了令人鼓舞的穩定跡象。

In our building products category, we're seeing big investments from customers as they anticipate favorable long-term market growth beyond 2023. Several markets appear to be bouncing off historic lows, such as architectural extrusion and coil, which is forecasting improving into 2024. The industrial team executed very well again on price and cost management, which helped to offset the volume decline.

在我們的建築產品類別中，我們看到客戶進行了大量投資，因為他們預計2023 年以後市場將出現良好的長期增長。一些市場似乎正在從歷史低點反彈，例如建築型材和卷材，預計到2024 年將會有所改善。工業團隊在價格和成本管理方面再次表現出色，這有助於抵消銷量下降的影響。

Moving to Slide 9. We continue to build momentum in Mobility Coatings. Volume improved 13%, reflecting a step-up in global auto and truck production versus the prior year as well as previously discussed new business wins. Growth was broad-based but especially strong in China and EMEA light vehicle. Price-mix contributed 3%, which included a 2% customer mix headwind.

轉向幻燈片 9。我們繼續在流動性塗料領域發展勢頭。銷量增長了 13%，反映出全球汽車和卡車產量較上年有所增長以及之前討論的新業務勝利。增長基礎廣泛，但在中國和歐洲、中東和非洲輕型汽車尤其強勁。價格組合貢獻了 3%，其中包括 2% 的客戶組合逆風。

In light vehicle, 2023 auto production forecasts have modestly but steadily improved year-to-date. Industry forecasters now project 86.7 million global builds, representing more than 5% growth over 2022. This incremental volume growth is driving improved fixed cost performance in our business. Given the elevated age of the global auto fleet, we expect to see sustained global production for the near and medium term.

在輕型汽車方面，2023 年汽車產量預測今年迄今已小幅但穩步提高。行業預測者目前預計全球構建量將達到 8670 萬個，比 2022 年增長 5% 以上。這種增量增長正在推動我們業務的固定成本績效改善。鑑於全球汽車保有量的增加，我們預計中短期內全球生產將持續。

In commercial vehicle, our customers remain bullish and the production outlook is strong for 2023. For Class 8 OEMs, backlogs remain elevated, especially in North America. We are monitoring demand into 2024 as some forecasters believe there could be a soft pocket, but as of yet we see limited signs of a slowdown.

在商用車方面，我們的客戶仍然看好，2023 年的生產前景強勁。對於 8 級 OEM 而言，積壓訂單仍然很高，尤其是在北美。我們正在監測 2024 年的需求，因為一些預測者認為可能會出現疲軟的情況，但到目前為止，我們看到的放緩跡像有限。

With that, let me turn the call over to Sean for a review of our financial performance.

接下來，讓我將電話轉給肖恩，以審查我們的財務業績。

Thank you, Chris, and good morning. Second quarter constant currency net sales increased 5% year-over-year to $1.3 billion. Adjusted EBIT improved to $155 million from $151 million in the prior year period, inclusive of $15 million in headwinds associated with consulting and ERP-related costs in the quarter.

謝謝你，克里斯，早上好。第二季度按固定匯率計算的淨銷售額同比增長 5%，達到 13 億美元。調整後息稅前利潤從上年同期的 1.51 億美元增至 1.55 億美元，其中包括本季度與諮詢和 ERP 相關成本相關的 1500 萬美元的不利因素。

Underlying earnings growth was driven by better price mix in addition to the lower raw material, energy and transportation unit rates. This quarter marks the first deflationary benefit we have recognized since incurring nearly $650 million of variable cost inflation through 2021 and 2022, representing an approximate 40% increase over this period.

除了原材料、能源和運輸單位費率下降之外，更好的價格組合也推動了基本盈利增長。本季度是我們自 2021 年和 2022 年發生近 6.5 億美元的可變成本通脹以來首次認識到的通貨緊縮效益，相當於在此期間增加了約 40%。

Variable costs declined 5% year-over-year in the second quarter with epoxies and isocyanates being the largest categories of drivers of the improvement. Market prices for most import categories are now trending favorably from historically high levels at year-end. We are also encouraged by early success in accelerating our cost recovery efforts due to the launch of our purchasing optimization program earlier this year, which we are clearly now seeing in what we are procuring today.

第二季度可變成本同比下降 5%，其中環氧樹脂和異氰酸酯是推動成本改善的最大因素。大多數進口類別的市場價格目前正從年底的歷史高位回升。由於今年早些時候啟動了採購優化計劃，我們在加速成本回收工作方面取得了早期成功，這也讓我們感到鼓舞，我們現在在今天的採購中清楚地看到了這一點。

The better variable cost environment in the quarter was offset by $9 million in realized foreign exchange losses in the quarter as well as higher compensation expense driven by variable incentive compensation, labor inflation and stock-based compensation expense due to the expected profit improvements in 2023. We are thoughtfully managing these increased costs and expect to largely offset their impacts over time through our ongoing productivity enhancement programs.

本季度較好的可變成本環境被本季度實現的 900 萬美元外匯損失以及可變激勵薪酬、勞動力通脹和 2023 年預期利潤改善導致的股票薪酬費用驅動的薪酬費用上漲所抵消。我們正在深思熟慮地管理這些增加的成本，並希望通過我們持續的生產力提高計劃，隨著時間的推移，很大程度上抵消其影響。

The cost of our productivity programs and the expenses related to the North American ERP implementation, as noted earlier, also drove $15 million of temporary spending in the period, in line with our second quarter guidance provided back in May.

如前所述，我們的生產力計劃成本以及與北美 ERP 實施相關的費用也推動了該期間 1500 萬美元的臨時支出，這與我們 5 月份提供的第二季度指導一致。

I will now cover Performance Coatings results on Slide 11. Performance Coatings second quarter net sales were flat year-over-year at $856 million. 9% better price mix and a 2% benefit from the absence of a customer contract restructuring charge impacting net sales in the second quarter 2022 was offset by lower volume. As Chris told you, operational constraints in the quarter drove a sale shortfall in North America, which disproportionately impacted Refinish volumes and the associated profitability. Performance Coatings second quarter adjusted EBIT was $118 million versus $125 million in the same period last year. Improved price cost dynamics drove a significant benefit to segment earnings in this quarter, but the impact of lower volumes and the allocation of roughly $10 million in costs associated with the enterprise projects led to the year-over-year decline.

現在我將在幻燈片 11 上介紹高性能塗料的業績。高性能塗料第二季度的淨銷售額與去年同期持平，為 8.56 億美元。價格組合改善 9%，以及由於沒有影響 2022 年第二季度淨銷售額的客戶合同重組費用而帶來的 2% 收益被銷量下降所抵消。正如克里斯告訴您的那樣，本季度的運營限制導致北美地區的銷售短缺，這對修補漆銷量和相關盈利能力產生了不成比例的影響。高性能塗料第二季度調整後息稅前利潤為 1.18 億美元，去年同期為 1.25 億美元。價格成本動態的改善為本季度的部門收益帶來了顯著的收益，但銷量下降以及與企業項目相關的約 1000 萬美元成本分配的影響導致了同比下降。

Industrial earnings were relatively stable year-over-year as proactive cost management and favorable price-cost mostly offset lower volumes.

由於積極的成本管理和有利的價格成本大部分抵消了銷量下降的影響，工業盈利同比相對穩定。

Moving to Q2 Mobility Coatings results on Slide 12. Mobility Coatings net sales increased 16% year-over-year to $438 million. Mobility Coatings adjusted EBIT improved to $24 million from $2 million in the second quarter of 2022 despite the allocation of $5 million in costs associated with enterprise projects in the quarter. Growth was supported by strong volumes and a favorable year-over-year price-cost benefit.

請看幻燈片 12 上的第二季度流動性塗料業績。流動性塗料淨銷售額同比增長 16%，達到 4.38 億美元。儘管本季度分配了 500 萬美元與企業項目相關的成本，但 Mobility Coatings 調整後的息稅前利潤從 2022 年第二季度的 200 萬美元增至 2400 萬美元。強勁的銷量和有利的同比價格成本效益支撐了增長。

Notably, our China business made considerable contributions to year-over-year improvement given an attractive mix of high-growth customers at healthy contribution margins. There is a clear improvement in the underlying earnings power of this segment. Momentum is building into the second half of the year, where I expect us to show further earnings and margin improvement in addition to volume growth.

值得注意的是，由於具有有吸引力的高增長客戶組合和健康的貢獻率，我們的中國業務為同比增長做出了巨大貢獻。該細分市場的潛在盈利能力明顯改善。今年下半年的勢頭正在增強，我預計除了銷量增長之外，我們還將進一步實現盈利和利潤率的改善。

Now turning to our debt and liquidity summary on Slide 13. Axalta's balance sheet continues to improve and our liquidity profile remains strong. We ended the quarter with just over $1 billion in total liquidity, including a cash balance of $518 million. Free cash flow in the quarter totaled $99 million compared to a cash use of $14 million in the second quarter of 2022. This is an excellent result that we expect to continue as we prioritize working capital and realized profitability improvements.

現在轉向幻燈片 13 上的債務和流動性摘要。艾仕得的資產負債表持續改善，我們的流動性狀況依然強勁。本季度末，我們的流動資金總額略高於 10 億美元，其中現金餘額為 5.18 億美元。本季度的自由現金流總計 9900 萬美元，而 2022 年第二季度的現金使用量為 1400 萬美元。隨著我們優先考慮營運資本並實現盈利能力的提高，我們預計這一結果將繼續下去。

For the second consecutive quarter, we voluntarily paid down $75 million in principal on our term loan, which now brings the year-to-date voluntary paydowns to $150 million. Gross debt reduction remains a high priority as we look to offset the impact of higher interest rates and strengthen our balance sheet. Note that we are also well positioned to explore other opportunities to reduce our interest expense given the recent expiration of the (inaudible) penalty on our term loan and following a favorable turn in capital markets over the last few weeks.

我們連續第二個季度自願償還了 7500 萬美元的定期貸款本金，目前，今年迄今的自願還款額已達到 1.5 億美元。由於我們希望抵消利率上升的影響並加強我們的資產負債表，因此減少總債務仍然是重中之重。請注意，鑑於我們定期貸款的（聽不清）罰款最近到期以及過去幾週資本市場出現有利轉變，我們也有能力探索其他機會來減少利息支出。

Our net leverage ratio was 3.6x, reflecting a slight improvement from 3.7x at March 31. And we expect operating performance improvements to drive meaningful deleveraging on both a net and gross basis throughout the remainder of the year.

我們的淨槓桿率為 3.6 倍，較 3 月 31 日的 3.7 倍略有改善。我們預計運營業績的改善將在今年剩餘時間內推動淨槓桿率和總槓桿率的有意義的去槓桿化。

Before concluding, I would like to extend my gratitude to the exceptional Axalta team and the Board of Directors, with whom I've had the pleasure of working with for the past decade. Being part of this journey over the last 10 years and being part of such a talented organization has been an immense privilege. My best wishes go out to each one of you, including our analysts and shareholders. Your partnership, trust and support have been greatly appreciated during my tenure here at Axalta.

在結束髮言之前，我要向杰出的艾仕得團隊和董事會表示感謝，在過去的十年裡我很高興與他們合作。能夠參與過去十年的這段旅程，並成為這樣一個才華橫溢的組織的一部分，我感到非常榮幸。我向你們每一個人致以最良好的祝愿，包括我們的分析師和股東。我在艾仕得任職期間，非常感謝您的合作、信任和支持。

Now I'll hand the call back to Chris for an update on guidance and concluding remarks.

現在，我將把電話轉給克里斯，以獲取有關指導和結論的最新信息。

Thanks again, Sean, for a decade of commitment to Axalta.

再次感謝肖恩十年來對艾仕得的承諾。

Moving to Slide 14 to review our Q3 and 2023 guidance. Third quarter adjusted EBIT is expected to be between $160 million to $175 million or $230 million to $245 million in adjusted EBITDA. For the full year 2023, we expect adjusted EBIT to be approximately $630 million to $650 million, corresponding to adjusted EBITDA of $910 million to $930 million, inclusive of $15 million in consulting costs incurred in Q2, which will amount to 13% increase over the 2022 at the midpoint. This reflects an EBITDA level we have not seen since 2019 and an improved earnings run rate entering 2024.

請轉到幻燈片 14，回顧我們的第三季度和 2023 年指導。第三季度調整後息稅前利潤預計在 1.6 億至 1.75 億美元之間，調整後 EBITDA 預計在 2.3 億至 2.45 億美元之間。對於2023 年全年，我們預計調整後的EBIT 約為6.3 億至6.5 億美元，對應調整後的EBITDA 為9.1 億至9.3 億美元，其中包括第二季度產生的1500 萬美元的諮詢費用，這將比上一季度增長13%。 2022 年的中點。這反映了我們自 2019 年以來從未見過的 EBITDA 水平，以及進入 2024 年盈利運行率的改善。

Our full year guidance framework assumes a mid-single-digit price-mix benefit for the full year, which implies a low single-digit exit rate in Q4. Typical seasonal demand patterns are expected in the second half but volume for the year is fairly flat with mobility recovery offsetting industrial softness. This view does not currently contemplate fully addressing elevated backlogs and raw material procurement is trending favorably. We expect to realize a mid- to high single-digit percent benefit in our variable costs for the second half of the year, which should provide a boost to margins and help mitigate elevated operating expenses.

我們的全年指導框架假設全年價格組合效益為中個位數，這意味著第四季度的退出率較低。預計下半年將出現典型的季節性需求模式，但全年銷量相當平穩，流動性複蘇抵消了工業疲軟。這種觀點目前並未考慮完全解決積壓增加的問題，而且原材料採購趨勢良好。我們預計下半年可變成本將實現中高個位數的效益，這將提高利潤率並有助於緩解運營費用的上升。

We are increasing our full year 2023 free cash flow guide to $385 million to $425 million from $350 million, following a stronger pace of working capital release than was previously expected as well as a slightly lower CapEx forecast as we focus on capital allocation prioritization.

我們將 2023 年全年自由現金流指南從 3.5 億美元提高到 4.25 億美元，因為營運資本釋放速度比之前預期更快，並且我們專注於資本配置優先順序，因此資本支出預測略低。

I'm encouraged on how 2023 is shaping up. We are well on our way to returning to prepandemic levels with a path to unlock even more earnings power in the quarters to come. I'm proud of our global team for their focused execution and commitment they have demonstrated through the first half. Axalta's potential is robust, given our market leadership positions, growth platform, talent and technology, all of which, I believe, will not only support but drive long-term growth and profitability.

我對 2023 年的發展感到鼓舞。我們正在努力恢復到大流行前的水平，並有望在未來幾個季度釋放更多盈利能力。我為我們的全球團隊在上半年表現出的專注執行力和承諾感到自豪。鑑於我們的市場領導地位、增長平台、人才和技術，艾仕得的潛力是巨大的，我相信，所有這些不僅將支持而且推動長期增長和盈利。

Sean and I will be pleased to answer your questions. Operator, please open the lines for Q&A.

肖恩和我很樂意回答您的問題。接線員，請開通問答線路。

(Operator Instructions) Our first question comes from Christopher Parkinson with Mizuho Securities.

（操作員指令）我們的第一個問題來自瑞穗證券的克里斯托弗·帕金森。

Just given everything that's going in the 3Q guide and you with FX, some carryover pricing trends in the marketplace. It obviously implies a fairly decent hit on volumes. And can you help us just kind of think about what we should be seeing on a segment level in the third quarter, what actually flows into that? Presumably some of that's the ERP. And probably just as importantly, how to bridge that with your 4Q expectations just given the annual guide? Any color on that would be very helpful.

剛剛給出了第三季度指南中的所有內容以及您對外彙的了解，市場上的一些結轉定價趨勢。這顯然意味著銷量受到相當大的打擊。您能否幫助我們思考一下第三季度我們應該在細分市場層面看到什麼，實際流入了什麼？大概其中一部分是 ERP。也許同樣重要的是，如何將其與剛剛給出的年度指南的第四季度預期聯繫起來？任何顏色都會非常有幫助。

Chris, it's Sean. Maybe I'll start here. So from a volume perspective, we're actually expecting third quarter to be somewhat similar to the second quarter. We're not baking in any sort of broader recovery as far as bringing the backlogs down. We're not expecting them to get any worse, and certainly, that could provide a little bit of upside if we're able to close that gap. But when you think about volume and pricing, it should look relatively stable opposite the second quarter. We'll certainly start to see a little bit more benefit from a [VCOGS] perspective, again probably a little bit conservative just given some of the priorities around bringing down working capital.

克里斯，這是肖恩。也許我會從這裡開始。因此，從銷量角度來看，我們實際上預計第三季度與第二季度有些相似。就減少積壓而言，我們不會推動任何更廣泛的複蘇。我們預計情況不會變得更糟，當然，如果我們能夠縮小這一差距，這可能會帶來一些好處。但當你考慮銷量和定價時，與第二季度相比，它應該看起來相對穩定。我們肯定會開始從[VCOGS]的角度看到更多的好處，考慮到降低營運資本的一些優先事項，可能又有點保守。

We're certainly not procuring as much from the raw material perspective as we have historically given the prioritization there. And then just the lower dollar inventory actually working its way through the balance sheet, that's part of the reason why you're not seeing a bigger margin uptick in the third quarter. And then it's a similar cadence into the fourth quarter. Again, there's probably a little bit of upside if we're able to close the gap. Internally, we're certainly focused on closing that backlog gap. And again, that would probably get us to the higher end of the range that we provided on the guidance slide.

從原材料角度來看，我們的採購量肯定不如我們歷史上優先考慮的那麼多。然後，只有較低的美元庫存實際上通過資產負債表發揮作用，這就是為什麼你在第三季度沒有看到更大的利潤率上升的部分原因。然後進入第四節也是類似的節奏。再說一遍，如果我們能夠縮小差距，可能還會有一點上行空間。在內部，我們當然專注於縮小積壓的差距。再說一遍，這可能會讓我們達到指導幻燈片上提供的範圍的高端。

Maybe just picking up from Sean, and I'll break it down into each of the individual 3 businesses. So obviously, Mobility with the seasonality of the Europe and North American shutdowns for 2 weeks in July, plus the standard August shutdowns in Mobility. So you do see a little bit of that softness that we have baked into the forecast.

也許只是從 Sean 那裡得知，我會將其分解為 3 個單獨的業務。很明顯，Mobility 受到歐洲和北美 7 月份為期 2 週的季節性停工，加上 Mobility 8 月份的標準停工。所以你確實看到了我們在預測中考慮到的一些疲軟因素。

Industrial we -- as Sean put out, we have actually looked at it being flat with what we have in Q2. And again, the real story here is in Refinish. And what we do have is we have the backlog being resolved by Q4, and we're giving ourselves time, obviously, with the impact that we had with our plant on the Refinish side. But any work that we do in improving that does provide us upside into Q4.

正如肖恩所說，工業我們實際上認為它與第二季度持平。再說一次，真正的故事是在修補漆中。我們所做的是，我們已經在第四季度解決了積壓的問題，顯然，我們正在給自己時間，以應對我們對工廠修補漆方面的影響。但我們在改進方面所做的任何工作確實為我們第四季度帶來了好處。

Just if we could just stick in there very, very quickly on -- just the refinish trend. I mean, if we -- kind of do the very quick back-of-envelope math on the ERP hit and what you publicized in your press release and look at that versus the volume decline in the second quarter, for what -- is there anything else going on there? Because I think obviously, presumably, it seems like everything is going very well. It seems like you're gaining shares with the MSOs, top 10s as well as a lot of the tail. Is there anything else that you think investors should be paying attention to? I mean, it seems things are going pretty well with Irus and the launch there in Europe. But just anything else we should be monitoring into 2024 would be very, very helpful.

只要我們能夠非常非常快地堅持下去——只是修補漆的趨勢。我的意思是，如果我們對 ERP 的點擊率以及您在新聞稿中公佈的內容進行快速的粗略計算，然後對比第二季度的銷量下降，會發現什麼？還有什麼事情發生嗎？因為我認為顯然，大概一切似乎都進展順利。看來您正在獲得 MSO、前 10 名以及許多尾部的份額。您認為還有什麼值得投資者關注的嗎？我的意思是，Irus 以及在歐洲的推出似乎進展順利。但到 2024 年我們應該監控的任何其他事情都會非常非常有幫助。

Sure, Chris. And maybe I'll -- absolutely, the story is very, very strong. And if you look at it purely from a volume perspective and look at that 8%, a portion of that is some volume compared to last year that we exited some low-margin business in LatAm.

當然，克里斯。也許我會——絕對的，這個故事非常非常強大。如果你純粹從銷量的角度來看，看看這 8%，與去年相比，其中一部分是我們退出了拉丁美洲一些低利潤業務的銷量。

The rest of it is all associated with our ERP launch specific to the North American impact. And so any resolution that we have there over the next 2 quarters essentially shows stable growth -- stable and growth in that business. And to your point, Irus will do nothing but help us enhance and grow the business going forward. So yes, with the exception in Q2 and Q3 of our decision to exit some low-margin business in LatAm, everything else is just the impact from the ERP launch.

其餘部分都與我們針對北美影響推出的 ERP 相關。因此，我們在未來兩個季度製定的任何決議基本上都顯示出穩定的增長——該業務的穩定和增長。就您而言，Irus 只會幫助我們增強和發展未來的業務。所以，是的，除了我們在第二季度和第三季度決定退出拉丁美洲的一些低利潤業務之外，其他一切都只是 ERP 啟動的影響。

And Chris, just to add on, I mean, we're still expecting record profitability in 2023 for Refinish. We still have a lot of the underlying tailwinds as we think about market recovery both in North America as well as Europe. You still see WIP at the body shop level at all-time highs as well as occupancy rates essentially stalled at roughly 50% North America. So we continue to see upside. But we're going to bring down this backlog over time. And I think what we saw in the second quarter was stability around demand. So we're really happy with how that business is performing, and the expectations are extremely high as we move forward.

克里斯，補充一下，我的意思是，我們仍然預計 2023 年修補漆的盈利能力將創歷史新高。當我們考慮北美和歐洲的市場復甦時，我們仍然有很多潛在的推動因素。您仍然會看到車身修理廠的 WIP 處於歷史最高水平，而北美的入住率基本上停滯在大約 50%。因此，我們繼續看到上行空間。但隨著時間的推移，我們將減少積壓的訂單。我認為我們在第二季度看到的是需求的穩定。因此，我們對該業務的表現非常滿意，並且隨著我們的前進，我們的期望非常高。

Our next question comes from John McNulty with BMO Capital Markets.

我們的下一個問題來自 BMO 資本市場的 John McNulty。

Sean, thanks for all the help over all the years. Just wanted to dig a little bit more, Chris, you spoke to -- when you first came in, I guess, on the last quarter call, you spoke to price recovery, raws productivity, supply chain optimization, et cetera. I guess now that you've been there for, call it, 6, 7 months or so, I guess, can you help us to frame a little bit in terms of how you're thinking about the upside or margin opportunity, maybe how you're thinking about 2024, if you're comfortable kind of giving that kind of color at this point as to how you're thinking about some of the improvements that you can see coming out over the next, say, 12 months or so?

肖恩，感謝您多年來的所有幫助。只是想深入了解一下，克里斯，當你第一次進來時，我猜，在上個季度的電話會議上，你談到了價格復甦、原材料生產力、供應鏈優化等問題。我想現在您已經在那里工作了 6、7 個月左右，我想您能否幫助我們框架一下您如何看待上漲或利潤機會，也許如何你正在考慮2024 年，如果你願意在此時給出這種顏色，以及你如何思考你可以看到在接下來的12 個月左右出現的一些改進？

Yes, that's a great question. I mean, I think if you look at our Q2, we had good performance in the quarter, which was just unfavorably impacted by our ERP launches that was primarily around 1 plant. And if you take that out, our guidance puts us on record earnings levels despite our investments in enterprise programs and obviously some elevated compensation spend comparing this year to last year. And if you talk about all those positive catalysts, price-mix, as we talk about this quarter is up 7%. Price-cost improvements continues to track well. And again, we do see as we head into Q3 and Q4, pricing will be a little bit more muted. As we started the year, we had about $120 million of cume price-cost gap across 2 of our businesses, with about 60% of that resolved across the Mobility and Industrial business, and we expect to have that solved through the year.

是的，這是一個很好的問題。我的意思是，我認為如果你看看我們的第二季度，我們在本季度表現良好，這只是受到我們主要圍繞 1 家工廠推出的 ERP 的不利影響。如果除去這一點，儘管我們對企業計劃進行了投資，而且與去年相比，薪酬支出顯然有所增加，但我們的指導使我們的盈利水平達到了創紀錄的水平。如果你談論所有這些積極的催化劑，我們談論的本季度價格組合上漲了 7%。價格成本改善繼續保持良好勢頭。再次，我們確實看到，當我們進入第三季度和第四季度時，定價將會更加平靜。今年年初，我們的兩個業務之間存在約 1.2 億美元的價格成本差距，其中約 60% 在移動和工業業務中得到解決，我們預計這一問題將在今年得到解決。

And then talking about additional positive catalyst, specialty raws -- with the exception of specialty raws like TiO2, the raw material benefit, as Sean talked about, continues to track well for the second half and we do see that being a positive tailwind into Q4.

然後談論額外的積極催化劑，特種原材料——除了 TiO2 等特種原材料外，正如 Sean 所說，原材料效益在下半年繼續保持良好勢頭，我們確實看到這是第四季度的積極推動力。

And so when you take all that, and I think if you take a look at our Q4 guide, to what we have built, even with the guide we had without the upside of solving the backlog in the Refinish side, it puts us at a midpoint at 243. And at the high point, what you will get is the second best quarter in the history -- the 10-year history of Axalta in terms of a Q4 performance.

因此，當您考慮所有這些時，我認為如果您看一下我們的第四季度指南，看看我們已經構建的內容，即使我們擁有的指南沒有解決修補漆方面積壓的好處，它也使我們處於中點為243。在高點，您將得到歷史上第二好的季度——艾仕得10 年曆史上第四季度的表現。

Usually, we see Q4 coming down. And if you take the top end of that guide, it essentially puts you as the best performance of Axalta has seen, with the exception of 2020 where we've obviously had to take some actions to get there. So it just talks to the underlying performance that exists in the company, obviously, once we get past these operational issues that I do believe we will have more than solved over the next 2 quarters.

通常，我們會看到第四季度的下降。如果您查看該指南的頂部，您會發現它本質上是艾仕得有史以來最好的表現，但 2020 年除外，我們顯然必須採取一些行動才能實現這一目標。因此，它只是討論了公司現有的基本業績，顯然，一旦我們克服了這些運營問題，我相信我們將在接下來的兩個季度內解決更多問題。

Got it. That's helpful color. And then maybe just a second one. You mentioned some mix issues in the auto OEM area and admittedly the price-mix was a little bit lower than, I guess, what we were looking for. It sounds like the pricing is actually pretty solid, and it was really just a mix issue. Can you just give us a little bit of color on -- and suss that out a little bit?

知道了。這是有用的顏色。然後也許只是第二個。您提到了汽車 OEM 領域的一些混合問題，並且誠然，我認為價格組合比我們想要的要低一些。聽起來定價實際上相當穩定，這實際上只是一個混合問題。你能否給我們一些顏色——然後稍微弄清楚一下？

Yes, John, I wouldn't characterize it as an issue. It just happened that we sold a little bit more volume in a particular layer that has a lower price point. It's not anything structural as far as changes from a mix perspective, but it was about a 2% headwind when you think about price-mix. But nothing to be worried about on that front.

是的，約翰，我不會將其視為一個問題。碰巧的是，我們在價格較低的特定層中銷售了更多的銷量。從組合的角度來看，這並不是什麼結構性的變化，但當你考慮價格組合時，這大約是 2% 的阻力。但在這方面沒什麼好擔心的。

Our next question comes from Joshua Spector with UBS.

我們的下一個問題來自瑞銀集團的約書亞·斯佩克特。

This is Lucas filling on for Josh. I just wanted to get back to the sequential assumptions in your 3Q earnings guidance and the bridge there. So we have the help from the low raw materials. We've got the impact of the ERP and the consultant investments rolling off and then the impact of the lost volumes catching up.

這是盧卡斯接替喬什的位置。我只是想回到第三季度盈利指引中的連續假設以及那裡的橋樑。所以我們有低原材料的幫助。我們已經看到 ERP 和顧問投資的影響逐漸減少，然後損失量的影響又迎頭趕上。

So each of those 3 buckets might be about $15 million each, so we've got a $45 million sequential improvement overall. So normally, your seasonality is a sort of $15 million to $20 million step-down, so that's like a $25 million to $30 million sequential benefit. So -- but your guidance is only up kind of $10 million to $15 million. So I'm just sort of wondering what are the other offsets there that I'm kind of missing in the bridge?

因此，這 3 個部分中的每一個可能約為 1500 萬美元，因此我們總體上獲得了 4500 萬美元的連續改進。所以通常情況下，你的季節性是 1500 萬到 2000 萬美元的遞減，所以這就像 2500 萬到 3000 萬美元的連續收益。所以 - 但你的指導意見只增加了 1000 萬至 1500 萬美元。所以我只是想知道我在橋中缺少的其他偏移是什麼？

Yes. Lucas, we are not currently contemplating bringing that in the backlog in the third quarter. This is what I hit on earlier. That's potentially upside, but right now that's not baked into our guidance. So when you think about pricing, it's going to be stable from the second quarter to third quarter. From a volume perspective, we're expecting stability across all the end markets.

是的。盧卡斯，我們目前不考慮將其納入第三季度的積壓工作中。這就是我之前想到的。這可能是有利的，但目前這還沒有納入我們的指導中。因此，當你考慮定價時，從第二季度到第三季度它將保持穩定。從銷量角度來看，我們預計所有終端市場都將保持穩定。

Light vehicle is just the one call-out, and you'll see some of the industry forecast. Europe is just typically down, and we're expecting, China just had a fantastic June, and industry forecasters are expecting a little bit of a pullback just seasonally. And then, yes, to your point, there will be a benefit from the consulting cost. They don't entirely go away but the majority will go away. And then we'll see a little bit more of a VCOGS step up and that's essentially a bridge.

輕型車輛只是其中之一，您還會看到一些行業預測。歐洲的經濟通常會下滑，我們預計，中國剛剛度過了一個美妙的六月，行業預測者預計會出現季節性的小幅回調。然後，是的，就你的觀點而言，諮詢成本將會帶來好處。它們不會完全消失，但大多數都會消失。然後我們會看到更多的 VCOGS 升級，這本質上是一座橋樑。

Great. And then just on Mobility. So I was just wondering there if you could help us understand sort of why earnings didn't kind of sequentially improve into the second quarter. So shouldn't there have been some benefit flowing through from lower raws in the quarter? And what are you thinking in terms of margins implied in the third quarter guide?

偉大的。然後就是移動性。所以我只是想知道您是否可以幫助我們理解為什麼第二季度的盈利沒有連續改善。那麼，本季度原材料的下降難道不應該帶來一些好處嗎？您對第三季度指南中隱含的利潤率有何看法？

Yes. So again, we tried to cover some of the underlying -- or the overview of remarks. But there was about a $5 million headwind as far as the consulting and ERP spending from enterprise perspective that got allocated to mobility. So that $24 million in EBIT becomes $29 million. And certainly, year-over-year, we are seeing some variable incentive comp headwinds as well as stock-based compensation, which is impacting margins from a year-over-year perspective.

是的。因此，我們再次嘗試涵蓋一些基本內容或言論概述。但從企業角度來看，分配給移動性的諮詢和 ERP 支出存在大約 500 萬美元的阻力。這樣，2400 萬美元的息稅前利潤就變成了 2900 萬美元。當然，與去年同期相比，我們看到了一些可變激勵補償的不利因素以及基於股票的薪酬，這從同比的角度來看正在影響利潤率。

And maybe, Lucas, just staying on mobility for a bit and just -- I view this as a great story as we look heading into '24. And I just want to jump off maybe to Sean's comments here. If you look at a $24 million EBIT for the quarter and you tack on the $5 million, you pretty much have a run rate. You can essentially annualize that and it puts you north of $100 million as we look at the full year for '22.

也許，盧卡斯，只是暫時停留在流動性上——當我們展望 24 世紀時，我認為這是一個很棒的故事。我只想跳出肖恩的評論。如果您查看本季度 2400 萬美元的息稅前利潤，再加上 500 萬美元，那麼您幾乎就得到了運行率。你基本上可以將其按年計算，當我們考慮 22 年全年時，你的收入將超過 1 億美元。

And if you take that in perspective and look at a very good year of 2019, we were about $140 million of the EBIT with $89 million bills. So we are about $3 million bills lower. And as we see the strength in the auto market driven by, let's call it, the demand forecast, not only from our customers but where IHS is going, it provides a good potential for prolonged upside case as we head into '24. And also on the heavy side, we're seeing about 7 months of backlog. So certainly something that you can see that the business is really well on track to double-digit EBITDA here. The teams are doing a great job outpacing the market as well as our peers here.

如果你正確看待這一點，看看 2019 年是非常好的一年，我們的息稅前利潤約為 1.4 億美元，賬單為 8900 萬美元。所以我們的賬單減少了大約 300 萬美元。當我們看到汽車市場的強勁勢頭是由需求預測驅動的，我們稱之為需求預測，不僅來自我們的客戶，而且來自IHS 的發展方向，當我們進入24 世紀時，它為長期上漲提供了良好的潛力。從嚴重的方面來看，我們看到了大約 7 個月的積壓。因此，您可以肯定地看到，該業務確實正在順利實現兩位數的 EBITDA。這些團隊做得非常出色，超越了市場以及我們的同行。

Our next question is from Aleksey Yefremov with KeyBanc Capital Markets.

我們的下一個問題來自 KeyBanc Capital Markets 的 Aleksey Yefremov。

So your implied fourth quarter EBITDA guidance was about $242 million. How should we think about this as a base for 2024? So does this 4Q include the majority of your price-cost benefit? And where do you think there's additional margin opportunity in 2024? And also, is there a volume opportunity next year?

因此，您隱含的第四季度 EBITDA 指引約為 2.42 億美元。我們應該如何看待這個作為 2024 年的基礎？那麼，這個第四季度是否包括了您的大部分價格成本效益？您認為 2024 年還有哪些額外的利潤機會？另外，明年是否有銷量機會？

Yes. Aleksey, I mean, at the high end, it would imply about $252 million EBITDA contribution in the fourth quarter. When you think about the price-cost dynamics, regardless of inflationary or deflationary environment, we'll continue to push price within Refinish. I mean, that's an area where we continue to innovate and provide value to customers, and we look to push through price.

是的。 Aleksey，我的意思是，從高端來看，這意味著第四季度 EBITDA 貢獻約為 2.52 億美元。當您考慮價格成本動態時，無論通脹還是通貨緊縮環境如何，我們都將繼續推高修補漆的價格。我的意思是，這是我們不斷創新並為客戶提供價值的領域，我們希望提高價格。

Some of the other businesses, as Chris mentioned, we are largely catching up and expect to be caught up by the end of the year. There could be some marginal pricing. It just depends on the pace of deflation. The bigger benefit really is expected from a run rate perspective around deflation. So today, where we're procuring inventories, we're probably down low double digits. As far as the back half of the year, we're expecting mid- to high single digits as far as the benefit in the P&L. So that will continue to unwind and provide potential margin upside as we round the corner into 2024.

正如克里斯所提到的，其他一些業務我們正在很大程度上迎頭趕上，並預計到今年年底將被趕上。可能會有一些邊際定價。這僅取決於通貨緊縮的速度。從通貨緊縮運行率的角度來看，確實預計會有更大的好處。因此，今天，我們採購庫存的價格可能會下降兩位數。就今年下半年而言，我們預計損益表中的收益將達到中高個位數。因此，隨著 2024 年的到來，這將繼續緩解並提供潛在的利潤上升空間。

And maybe -- we have talked about consulting, and obviously, there are 3 elements of the consulting spend. The one obviously was specific to the ERP project and the support that it provided our [IHS] folks. But on top of that, we have efficiency projects, one focused on reducing our inventory, which is how we were able to increase our working capital guide for the year as well as drive about $90 million in reduced inventory. But the next one here, Aleksey, is a purchasing initiative that will favorably impact our material performance beyond just the indexing, which we expect to see a better -- the drop-through after the inventory flow through to hit the P&L somewhere in Q4 and prepare us for 2024 as well.

也許——我們已經討論過諮詢，顯然，諮詢支出有 3 個要素。這顯然是針對 ERP 項目及其為我們的 [IHS] 人員提供的支持。但最重要的是，我們還有效率項目，其中一個重點是減少庫存，這就是我們如何能夠增加今年的營運​​資金指南，並減少約 9000 萬美元的庫存。但阿列克西的下一個目標是一項採購計劃，它將對我們的材料績效產生有利影響，而不僅僅是索引，我們預計索引會更好——庫存流經後的下降，在第四季度的某個地方達到損益表，也讓我們為 2024 年做好準備。

Related to this, I guess by my estimate, you'd be spending somewhere around $45 million this year on ERP and other consulting costs, right? $15 million in the second quarter and perhaps $10 million per quarter in the -- or so in the back half. How do you think all these costs all-in compare in 2024 versus 2023?

與此相關，根據我的估計，您今年將在 ERP 和其他諮詢成本上花費約 4500 萬美元，對嗎？第二季度為 1500 萬美元，後半段每個季度可能為 1000 萬美元。您認為 2024 年和 2023 年的所有這些成本總計如何？

Well, I think if you total what we have, it's about $30 million. And what we are saying, $15 million is obviously associated with our ERP launch. And Aleksey, simply put, this was a 25-year-old system legacy system that we needed change. This essentially takes 6 ERP systems globally and puts it into 1. It's 4 years in the making, and it's certainly something that we need to be able to manage our systems and essentially have the ability not only to have pricing but also operational and supply chain intelligence.

嗯，我想如果你把我們所擁有的全部加起來的話，大約是 3000 萬美元。我們所說的 1500 萬美元顯然與我們的 ERP 啟動有關。 Aleksey，簡單地說，這是一個已有 25 年曆史的遺留系統，我們需要對其進行更改。這基本上需要全球6 個ERP 系統並將其放入1 個中。它的製作花費了4 年時間，這當然是我們需要能夠管理我們的系統的東西，並且本質上不僅要有定價能力，還要有運營和供應鏈的能力智力。

So again, this was a project that had over 300 folks working on it, impacted 1,100 employees and impacted 11 plants and a multitude of distribution centers. And we went through this, obviously have the impact of 1 plant, but had a banner launch at all the other sites. So obviously, very little in terms of payback from that. However, on the $15 million of additional expense on consulting, this was really to prepare ourselves for the back end of this year and really get us ready for '24. And all of these have less than a 2-year payback.

同樣，這個項目有 300 多人參與，影響了 1,100 名員工，影響了 11 家工廠和多個配送中心。我們經歷了這一過程，顯然對 1 個工廠產生了影響，但在所有其他站點都發布了橫幅。顯然，從回報來看，這一點微乎其微。然而，對於 1500 萬美元的額外諮詢費用，這實際上是為了今年年底做好準備，並真正為 24 世紀做好準備。而所有這些的投資回收期都不到2年。

Our next question comes from Duffy Fischer with Goldman Sachs.

我們的下一個問題來自高盛的達菲·費舍爾。

If we could, I mean, I'm just looking at your margins, both what you've done this year. So [16.6%] -- and this is EBITDA margin, 16.6% in Q1, [17.5%] in Q2. The midpoint of your guide for Q3 is [18.4%]. So basically, you're stepping up almost 1% per quarter sequentially. But then the implied guide when you get to Q4 is for a [17.8%] EBITDA margin. And with raw materials kind of falling throughout the year, and they're trending down as we speak, why wouldn't Q4 with its increased revenue sequentially from Q3 continue that trend of improving margin?

如果可以的話，我的意思是，我只是看看你們的利潤，包括你們今年所做的事情。所以[16.6%]——這是 EBITDA 利潤率，第一季度為 16.6%，第二季度為[17.5%]。第三季度指南的中點是 [18.4%]。所以基本上，每個季度的增長率幾乎是 1%。但是，當您進入第四季度時，隱含的指導是 EBITDA 利潤率 [17.8%]。由於原材料全年都在下降，而且正如我們所說，它們正呈下降趨勢，為什麼第四季度收入比第三季度連續增加，不能繼續保持利潤率提高的趨勢呢？

Duffy, you're seeing the dynamic in the fourth quarter just seasonally with some of our end markets dropping off with the holiday month in December.

達菲，您看到第四季度的動態只是季節性的，我們的一些終端市場隨著 12 月的假期月份而下降。

But I guess I'd push back on that because your sales are up $100 million at the midpoint from Q3 to Q4. So some things may be falling off. But what you're saying is actually the company is still growing nicely, 5% sequentially. So something in there doesn't triangulate.

但我想我會反駁這一點，因為從第三季度到第四季度的中點，你們的銷售額增長了 1 億美元。所以有些東西可能會脫落。但你所說的實際上是公司仍然在快速增長，環比增長了 5%。所以里面的東西沒有三角測量。

Duffy, I'll point to -- there's certainly opportunity from a margin perspective, focused on the procurement side as well as closing the backlog. And if you look at the upper end of the fourth quarter being $252 million EBITDA and potentially providing upside if some of the other aspects come to fruition, there certainly could be upside from a margin perspective.

達菲，我要指出的是，從利潤角度來看，肯定存在機會，重點是採購方面以及結束積壓。如果你看看第四季度 EBITDA 的上限為 2.52 億美元，如果其他一些方面取得成果，則可能帶來上行空間，那麼從利潤率角度來看，肯定會有上行空間。

Okay. And then just because I'm getting pinged quite a bit on Bloomberg, there still seems to be some confusion around the sequential revenue build, and maybe we can attack it kind of year-over-year. So in your guide, you're up 0% to 2% year-over-year in Q2 on revenue excluding FX. And price should still -- price-mix should still be a pretty significant benefit, I would think. So that would imply year-over-year Q3 volumes may be down 2-ish percent. So one, could you help with that? And then if that's the case, kind of where will we see it? But then it seems like again with that bigger revenue number in Q4, we start growing volume kind of low single digits in Q4. What improves in that number from Q3 to Q4, in your mind?

好的。然後，僅僅因為我在彭博社上得到了很多關注，關於連續收入的增長似乎仍然存在一些混亂，也許我們可以逐年攻擊它。因此，在您的指南中，第二季度不包括外彙的收入同比增長了 0% 到 2%。我認為，價格應該仍然是一個相當顯著的好處。因此，這意味著第三季度銷量可能同比下降 2% 左右。那麼，你能幫忙嗎？如果是這樣的話，我們會在哪裡看到它？但隨著第四季度收入數據的增加，我們的銷量似乎又開始以較低的個位數增長。您認為從第三季度到第四季度該數字有何改進？

So Q2 to Q3 guide, I think we covered this, but it's Industrial and Refinish are largely flat. And then Mobility, you're seeing a slight pullback just given the European and China dynamic. And then from Q3 to Q4, you are seeing a slight uptick as it relates to Industrial volumes and a little bit Mobility just as seasonally recovering from Q3 to Q4.

所以第二季度到第三季度的指南，我認為我們已經涵蓋了這一點，但工業和修補漆基本上持平。然後是移動性，考慮到歐洲和中國的動態，您會看到輕微的回調。然後從第三季度到第四季度，您會看到略有上升，因為它與工業量和流動性有關，就像從第三季度到第四季度的季節性複蘇一樣。

Our next question comes from Vincent Andrews with Morgan Stanley.

我們的下一個問題來自摩根士丹利的文森特安德魯斯。

Just wondering, with the issues with the ERP implementation in the second quarter, do you have to provide any terms or make holes or anything for customers in order to maintain that backlog in the North American market? And/or are you baking in any conservatism into the back half of the year for any further ERP implementation issues?

只是想知道，隨著第二季度ERP實施的問題，你們是否需要為客戶提供任何條款或漏洞或任何東西，以維持北美市場的積壓？和/或您是否會在今年下半年採取保守態度，以解決任何進一步的 ERP 實施問題？

Yes. So I'll take that, and thanks for the call, Vincent. So yes, we are in terms of having some cushion. And let me just walk through it. Again, the primary impact of our ERP launch was specific to our Refinish business. And what we did here was obviously -- we launched on May 1, and May was a tough month across our Refinish business associated with our plant in Virginia. However, just to put it in perspective, the teams across the globe rallied in June. And we had -- if you put Axalta into perspective, Axalta has been around for 10 years, just over 10 years. In 123 months, we had the second best month in the history of the company from a sales, EBITDA and a margin performance.

是的。所以我會接受的，謝謝你的電話，文森特。所以，是的，我們有一些緩衝。讓我簡單介紹一下。同樣，我們的 ERP 啟動的主要影響是針對我們的修補漆業務的。我們在這裡所做的顯然是——我們於 5 月 1 日推出，對於我們與弗吉尼亞工廠相關的修補漆業務來說，5 月是艱難的一個月。然而，從長遠來看，全球各地的團隊在 6 月份齊聚一堂。我們——如果你正確看待艾仕得，你會發現艾仕得已經存在了 10 年，剛剛超過 10 年。在 123 個月的時間裡，我們的銷售額、EBITDA 和利潤率表現在公司歷史上排名第二。

So it just talks to the foundation and what the teams were able to rally back and accomplish in the month of June coming out of our issues in May. And so as we built our forecast for Q3 and Q4, we did have a backlog. Obviously, as you know, there is a pickup in Q3 for Refinish. So on top of that, we have the backlog. And what we have done in our forecast is provide the ability for us over 2 quarters to be able to bring down -- normalize that backlog, but the benefit of that is not in our forecast.

因此，它只是與基金會討論，以及團隊在 6 月份從 5 月份的問題中恢復過來並完成的工作。因此，當我們對第三季度和第四季度進行預測時，我們確實有積壓的訂單。顯然，如您所知，修補漆在第三季度有所回升。最重要的是，我們還有積壓的訂單。我們在預測中所做的就是讓我們有能力在兩個季度內減少積壓，使積壓正常化，但這樣做的好處並不在我們的預測中。

So all that said, in terms of the loss of customers, as you are aware, this is the Refinish business. And we believe we can hold these customers. We don't have the issue of destocking that you might have heard from others. What we have here is what we have done is obviously reduce our inventory levels. at our distributors at our -- through the channel. And what we're doing is replenishing that as well as making sure that we deliver to our customers what they need. So that's exactly what we're focused on over the next 2 quarters.

綜上所述，就客戶流失而言，正如您所知，這是修補漆業務。我們相信我們能夠留住這些客戶。我們不存在您可能從其他人那裡聽說過的去庫存問題。我們所做的就是明顯降低我們的庫存水平。在我們的經銷商處，在我們的渠道處。我們正在做的就是補充這些，並確保我們向客戶提供他們需要的東西。這正是我們未來兩個季度的重點。

And just as a follow-up. SG&A is up $30 million. Can you just help me understand the components of that are? Is the consultant spending in there? Is some of that investment spending? Or just sort of what's the bridge there? And how should it play out over the balance of the year?

並且只是作為後續行動。 SG&A 增加了 3000 萬美元。你能幫我理解它的組成部分嗎？顧問的開支在裡面嗎？其中有一部分是投資支出嗎？或者只是那裡的橋是什麼？今年剩下的時間裡它應該如何發揮作用？

Yes. The vast majority of the increase relates to incentive compensation. Last year, we tracked well below our target from a budget perspective. Global incentive comp ranged around 70% of the payoff. We're tracking above the incentive comps this year. So that's really the vast majority of the headwind from an SG&A perspective.

是的。絕大多數增長與激勵性薪酬有關。去年，從預算角度來看，我們遠遠低於我們的目標。全球激勵補償佔回報的 70% 左右。我們今年的目標是激勵薪酬。因此，從 SG&A 角度來看，這確實是最主要的阻力。

Okay. Good luck, Sean.

好的。祝你好運，肖恩。

Thank you.

謝謝。

Our next question comes from David Begleiter with Deutsche Bank.

我們的下一個問題來自德意志銀行的 David Begleiter。

This is Anthony Mercandetti on for David. Just back on the ERP. Can you quantify the benefits that you're expecting to realize by Q4 and then how we should think about this flowing through the P&L in 2024?

我是安東尼·梅爾坎德蒂 (Anthony Mercandetti) 替補出場。剛剛回到 ERP。您能否量化您期望在第四季度實現的收益，然後我們應該如何考慮這一收益在 2024 年的損益表中的流動？

Yes. So we'll be providing the benefits with the ERP launch as part of the 2024 guide. We're expecting limited benefit other than the absence of the cost that we incurred in the second quarter as it relates to third quarter and fourth quarter. Right now, it's the focus on continuous stability at our plants. But then we'll quickly turn to value realization. As part of this ERP implementation, we redid our integrated business planning. We put in new pricing tools. And obviously, we get a lot more visibility into transactions and working capital that we expect to benefit in 2024. But again, we'll provide more guidance when we're out with the 2024 guidance construct.

是的。因此，我們將作為 2024 年指南的一部分提供 ERP 啟動帶來的好處。除了第二季度與第三季度和第四季度相關的成本消失之外，我們預計收益有限。目前，我們工廠的重點是持續穩定。但隨後我們將很快轉向價值實現。作為 ERP 實施的一部分，我們重新制定了綜合業務規劃。我們採用了新的定價工具。顯然，我們對交易和營運資金有了更多的了解，預計將在 2024 年受益。但同樣，當我們推出 2024 年指導結構時，我們將提供更多指導。

Understood. And then as other geographies roll out, their own ERP implementations, do you expect similar, I guess, operational hurdles and cost that we saw in North America? Or is this process more streamlined since it's been done already?

明白了。然後，隨著其他地區推出自己的 ERP 實施，您是否預計會遇到我們在北美看到的類似運營障礙和成本？或者這個過程已經完成了，是否更加簡化？

Well, that's a great question. One of the things that we are doing is going to take a bit of a pause for about a year and get launched with other regions such as Asia and LatAm and then start with Europe, which would be the next launch, a large region. So we're going to probably take this over the next 2 to 3 years.

嗯，這是一個很好的問題。我們正在做的事情之一是暫停大約一年，然後在亞洲和拉丁美洲等其他地區推出，然後從歐洲開始，這將是下一個推出的大區域。因此，我們可能會在未來 2 到 3 年內採取這一措施。

And obviously, big lesson is learnt that we have from here as well for us. But again, as I said, when you consider the scope, scale and magnitude of the project, I am pleased with the implementation. And so there are some lessons learned on warehouse management and shipping management that we will take and apply as we go forward in future launches.

顯然，我們也從這裡學到了重要的教訓。但正如我所說，當你考慮到該項目的範圍、規模和規模時，我對實施感到滿意。因此，我們在倉庫管理和運輸管理方面吸取了一些經驗教訓，我們將在未來的發布中吸取並應用這些經驗教訓。

Got it. And just to be clear, so Europe would be the next large launch when that time does come, followed by Asia and LatAm?

知道了。需要明確的是，當那個時候到來時，歐洲將是下一個大型發布，其次是亞洲和拉丁美洲？

No, no, no. The next 2 launches would be Asia and LatAm. Europe will be last.

不不不。接下來的兩次發布將在亞洲和拉丁美洲。歐洲將排在最後。

Our next question comes from Ghansham Panjabi with Baird.

我們的下一個問題來自 Ghansham Panjabi 和 Baird。

This is actually Matt Krueger sitting in for Ghansham. So given the major shift in pricing over the last couple of years now, transitioning to a more favorable raw material sourcing environment, can you talk a bit about what you're seeing from a competitive backdrop perspective? Maybe highlighting any key gains by end market or region as well as where you may be facing some comparatively stiffer competition.

這實際上是馬特·克魯格（Matt Krueger）代替甘沙姆（Ghansham）。因此，考慮到過去幾年定價的重大轉變，正在向更有利的原材料採購環境過渡，您能否從競爭背景的角度談談您所看到的情況？也許會強調終端市場或地區的任何關鍵收益，以及您可能面臨一些相對更激烈的競爭。

Sure. Maybe I'll start, and I'll turn this over to Sean. But as I look at price-mix, as a company, as we said in our prepared remarks, we were able to do 7%. And I think the teams have done a stellar job, 10% in Refinish, 7% in Industrial even with the volumes going down 15%. And in Mobility, even with the 2% headwind we did 3%. So overall, as a company, we've accomplished 7% and shows the continued focus on driving both price and cost.

當然。也許我會開始，然後我會把這件事交給肖恩。但當我考慮價格組合時，作為一家公司，正如我們在準備好的發言中所說，我們能夠做到 7%。我認為這些團隊做得非常出色，修補漆方面佔 10%，工業方面佔 7%，儘管銷量下降了 15%。在移動性方面，即使有 2% 的逆風，我們也做到了 3%。總體而言，作為一家公司，我們已經實現了 7%，這表明我們繼續關注推動價格和成本。

It is becoming more muted in the back half, and let me talk to it in this sense. We started the year with about $120 million of cume price-cost negative, specifically in 2 out of our 4 end markets, light vehicle and industrial. And the teams have done a stellar job with more than half of that being resolved as we sit here today.

後半部分變得更加靜音，讓我從這個意義上談談它。今年伊始，我們的價格成本負值約為 1.2 億美元，特別是在我們 4 個終端市場中的 2 個，即輕型汽車和工業市場。這些團隊做得非常出色，當我們今天坐在這裡時，其中一半以上已經得到解決。

And my expectation is by the end of the year and starting into 2024, most -- all of that will get resolved. So we will -- pricing will become more muted as we have stabilized and -- especially loans, we also start seeing the benefits of the raw material deflation. So far, we've obviously had some pushback with customers, but again, the performance of the business indicates how well this has been sticking.

我的期望是，到今年年底並從 2024 年開始，所有這些問題都將得到解決。因此，隨著我們的穩定，價格將變得更加平靜，尤其是貸款，我們也開始看到原材料通貨緊縮的好處。到目前為止，我們顯然受到了客戶的一些抵制，但業務的表現再次表明了這一點的堅持程度。

Great. That's very helpful. And then your earnings release and presentation is fairly unique in that, it doesn't reference destocking at all. It may be the first release that I've seen like this throughout the reporting period. Can you provide some details on any potential impact from supply chain destocking across the business during the quarter? And if there wasn't an impact, why is Axalta's business so uniquely immune at this point?

偉大的。這非常有幫助。然後你的收益發布和演示是相當獨特的，它根本沒有提到去庫存。這可能是我在整個報告期間看到的第一個這樣的版本。您能否提供一些有關本季度供應鏈去庫存對整個企業的潛在影響的詳細信息？如果沒有影響，為什麼艾仕得的業務目前如此獨特地不受影響？

So Matt, I mean, we just don't go through distribution, and most of our customers are just not holding as much Refinish, keeping that aside. We actually destocked in North America within distribution just because of the ERP element. So that certainly provides some upside for us. Where we saw some marginal destocking was really within building products in North America. And so you saw with 15% pullback within Industrial. Building products was really a core driver to that. Certainly, building products market weakness, but there was some element of destocking. Again, it's just not as pervasive of an issue for us and why we're not calling it out.

所以馬特，我的意思是，我們只是不進行分銷，而且我們的大多數客戶只是沒有持有那麼多的修補漆，將其放在一邊。實際上，由於 ERP 元素，我們在北美的分銷範圍內減少了庫存。所以這肯定為我們提供了一些好處。我們看到，北美的建築產品確實出現了一些邊際去庫存。因此，您看到工業領域出現了 15% 的回調。構建產品確實是這一目標的核心驅動力。當然，建築產品市場疲軟，但也有去庫存的因素。再說一次，這對我們來說並不是一個普遍存在的問題，也是我們不大聲疾呼的原因。

Okay. That makes a lot of sense across the Mobility businesses.

好的。這對於移動業務來說非常有意義。

Our next question comes from John Roberts with Credit Suisse.

我們的下一個問題來自瑞士信貸銀行的約翰·羅伯茨。

Best wishes Sean, and welcome, Carl and Kevin, if you're listening in. I believe Axalta sells coatings for auto OEM parts that are painted off-line and then shipped to OEMs. Does that part of the business serves a leading indicator for the OEM business? And what are you seeing in the parts business?

最好的祝愿肖恩，歡迎卡爾和凱文，如果你們正在聽的話。我相信艾仕得銷售用於汽車原始設備製造商零件的塗料，這些零件離線塗漆，然後運送給原始設備製造商。這部分業務是否是 OEM 業務的領先指標？您對零部件業務有何看法？

Well, overall, John, we're seeing very, very strong demand across the light vehicle business. I mean, we're exceeding initial demand forecast. As you can see, IHS, it keeps ratcheting it up a bit, a bit, a bit. We're up at 86.7 million bills right now. And on top of that, all the -- preparing for this, all the initial checks that we've done with the customers, also shows a very strong underlying demand.

嗯，總的來說，約翰，我們看到整個輕型汽車業務的需求非常非常強勁。我的意思是，我們超出了最初的需求預測。正如你所看到的，IHS，它一直在一點點地提高它。我們現在有 8670 萬張賬單。最重要的是，所有為此做的準備，我們與客戶所做的所有初步檢查，也顯示出非常強勁的潛在需求。

And on top of the fact that the aged auto fleet and the fact that we had 4 years of underbuilding is creating, what I would call, as a mid to -- a short to midterm upside case. And then on the heavy side truck, backlogs remain incredibly strong. Again, doing some customer checks, what we're seeing is that our customers, even with record outputs, are sitting with almost 7 months in backlog. So both businesses do look very strong. On the heavy side, there is some concern in '24 of a possible softness from some folks. But certainly, we're not seeing it at this point.

最重要的是，老化的汽車車隊和我們已經有四年的建設不足正在創造，我所說的，作為中短期的上行情況。而重型側卡車的積壓情況仍然非常嚴重。再次進行一些客戶檢查，我們發現我們的客戶即使產出創紀錄，也有近 7 個月的積壓。所以這兩家公司看起來確實都非常強大。從悲觀的角度來看，一些人擔心 24 年可能會出現疲軟。但當然，我們目前還沒有看到這一點。

Our next question comes from Kevin McCarthy with Vertical Research Partners.

我們的下一個問題來自垂直研究合作夥伴的凱文·麥卡錫。

In your Mobility segment, you've talked in the past about commercial courage and an effort to restore margins. So my question would be at this juncture of the cycle where we have raw material costs coming down sharply, in some cases, do you think you can continue to move price higher on a sequential basis in Mobility exclusive of mix? Or does that become impractical based on your recent customer experiences?

在您的移動業務部分，您過去曾談論過商業勇氣和恢復利潤的努力。所以我的問題是，在這個週期的關鍵時刻，我們的原材料成本急劇下降，在某些情況下，您認為您是否可以繼續將移動性（不包括混合）的價格繼續推高？或者根據您最近的客戶體驗，這是否變得不切實際？

What we're seeing right now is -- so I would say the pricing on Mobility, especially, I believe, on the light vehicle side started off pretty slow. And as you -- as we rewound the clock 1 year, 1.5 years ago, the most significant, let's call it, price-cost cume negative was sitting in our Mobility business. As we sit today, we still have the largest price-cost cume gap sitting in Mobility.

我們現在看到的是——所以我想說的是，移動出行的定價，特別是我相信，輕型車輛方面的定價起步相當緩慢。正如您所說，當我們把時間倒回 1 年、1.5 年前時，我們的移動業務中最重要的，我們稱之為價格成本負值。當我們今天坐下來時，我們仍然在移動領域面臨著最大的價格成本差距。

But the teams are doing a great job trying to resolve that, working with our customers. And as I look at the second half of the year, we do see that becoming more muted. We are starting to essentially get to a point that as the costs come down, the price-cost cume gap is also starting to level out. So we do believe that it will get more muted. But overall, our customers understand that we need to invest in this business.

但團隊正在與客戶合作，努力解決這個問題，做得很好。當我回顧今年下半年時，我們確實看到這種情況變得更加平靜。我們已經開始意識到，隨著成本的下降，價格與成本的差距也開始趨於平穩。所以我們確實相信它會變得更加靜音。但總的來說，我們的客戶明白我們需要投資這項業務。

There is absolutely significant amounts of investment, especially on the light vehicle mobility side that we have to keep doing to keep ahead in terms of the product requirements for our customers. So certainly, it has been a long discussion, but I believe we're in the right spot. And as prices come down here, we are starting to mute those discussions going forward.

絕對有大量的投資，特別是在輕型車輛移動方面，我們必須繼續這樣做，才能在客戶的產品需求方面保持領先地位。當然，這是一個漫長的討論，但我相信我們處於正確的位置。隨著這裡的價格下降，我們開始壓制這些未來的討論。

Yes. And just maybe to add, roughly 40% of those contracts are on indexation. So you'll see some price give back, but you should continue to see variable margin improvement as we're seeing the deflationary benefits. The team is very focused. Still -- we're still 40 to 50 behind at the end of Q2 from a price-cost gap. So the team is continuing to drive. It's just a lot more selective, looking OEM by OEM, region by region. So I do think there's continued opportunity as the team continues to execute on margin recovery.

是的。也許還要補充一點，這些合約中大約 40% 是指數化的。因此，您會看到一些價格回落，但您應該繼續看到可變利潤率的改善，因為我們看到了通貨緊縮的好處。團隊非常專注。儘管如此，到第二季度末，我們的價格與成本差距仍然落後 40 到 50。因此，車隊仍在繼續前進。只是更具選擇性，尋找 OEM 廠商、地區廠商。因此，我確實認為，隨著團隊繼續執行利潤恢復，機會仍然存在。

Okay. And secondly, how would you compare Irus to your existing Daisy Wheel product and also your competitors' Moonwalk product? Is it essentially Daisy Wheel 2.0 or something that's more of a step function change? And are there financial implications we should be thinking about as you ramp up in Europe and elsewhere in terms of providing the equipment and those sorts of considerations on margins, for example?

好的。其次，您如何將 Irus 與您現有的 Daisy Wheel 產品以及競爭對手的 Moonwalk 產品進行比較？它本質上是菊花輪 2.0 還是更多的階梯功能變化？例如，當您在歐洲和其他地方提供設備以及對利潤的此類考慮時，我們是否應該考慮財務影響？

I absolutely love that question. So if it's 2.0 or 3.0, I look at it as just an absolute game changer. It's -- Irus is next-level technology. It's a fully automated match-and-mix system that I believe sets us apart from our peers. As you're aware, in the Refinish space, this is an absolute necessity and a table stake as you play in this space. And I believe this process advancement really differentiates us from -- differentiates the Refinish business and our extraordinary team of people that work here.

我非常喜歡這個問題。因此，如果是 2.0 或 3.0，我認為它絕對是遊戲規則的改變者。 Irus 是下一代技術。這是一個完全自動化的匹配和混合系統，我相信這使我們在同行中脫穎而出。如您所知，在修補漆領域，這是絕對必要的，也是您在這個領域發揮作用的賭注。我相信這一流程的進步確實使我們與修補漆業務以及我們在這里工作的傑出團隊脫穎而出。

It's really special because it's the only fully automated machine that I believe is faster than anything in the market. And I'll give you a couple of data points here in terms of benefit to our customers. Obviously, even starting with our existing customers, this is less than a year's payback on this product for them. And if we move from that to sustainability, this uses Axalta's own bottles, which is made from 50% recycled plastic. And in this sense, on just our customers within a year, we've reduced about 400 tons of plastic that goes into landfills. And then on top of that, in just our launch in Europe, to what you mentioned, our customer feedback has just been incredibly tremendous. In my first 7 months and just spending time with the team and spending time in Europe listening to customers, this has just been absolutely great feedback and see this as our next evolution on how we grow this business going into next year.

它真的很特別，因為我認為它是唯一比市場上任何機器都快的全自動機器。我將在這里為您提供一些關於為我們的客戶帶來的好處的數據點。顯然，即使從我們現有的客戶開始，對於他們來說，這個產品的回報還不到一年。如果我們從這個轉向可持續發展，那就使用艾仕得自己的瓶子，它由 50% 的再生塑料製成。從這個意義上說，僅就我們的客戶而言，我們在一年內就減少了約 400 噸進入垃圾填埋場的塑料。最重要的是，在我們剛剛在歐洲推出時，正如您所提到的，我們的客戶反饋非常巨大。在我的前7 個月裡，我花時間與團隊在一起，花時間在歐洲傾聽客戶的意見，這絕對是很好的反饋，並將其視為我們明年如何發展這項業務的下一步發展。

Thank you. There are no further questions at this time. Thank you so much for your participation. This concludes today's teleconference. You may disconnect your lines at this time.

謝謝。目前沒有其他問題。非常感謝您的參與。今天的電話會議到此結束。此時您可以斷開線路。