Acuity Brands Inc (AYI) 2023 Q3 法說會逐字稿

Good morning, and welcome to the Acuity Brands Fiscal 2023 Third Quarter Earnings Call. (Operator Instructions) After the speaker's presentation, the company will conduct a question-and-answer session. Please be advised that today's conference is being recorded.

早上好，歡迎參加 Acuity Brands 2023 財年第三季度收益電話會議。 （操作員說明） 演講者演講結束後，公司將進行問答環節。請注意，今天的會議正在錄製中。

I would now like to hand the conference over to Charlotte McLaughlin, Vice President of Investor Relations. Charlotte, please go ahead.

現在我想將會議交給投資者關係副總裁夏洛特·麥克勞克林 (Charlotte McLaughlin)。夏洛特，請繼續。

Thank you, Liz. Good morning, and welcome to the Acuity Brands Fiscal 2023 Third Quarter Earnings Call. As a reminder, some of our comments today may be forward-looking statements based on our management's beliefs and assumptions and information currently available to our management at this time. These beliefs are subject to known and unknown risks and uncertainties, many of which may be beyond our control, including those detailed in our periodic SEC filings. Please note that our company's actual results may differ materially from those anticipated, and we undertake no obligation to update these statements. Reconciliations of certain non-GAAP financial metrics with their corresponding GAAP measures are available in our 2023 3rd quarter earnings release, which is available on our Investor Relations website at www.investorsacuitybrands.com.

謝謝你，莉茲。早上好，歡迎參加 Acuity Brands 2023 財年第三季度收益電話會議。提醒一下，我們今天的一些評論可能是基於我們管理層的信念和假設以及我們管理層目前可獲得的信息的前瞻性陳述。這些信念受到已知和未知的風險和不確定性的影響，其中許多風險和不確定性可能超出我們的控制範圍，包括我們定期向 SEC 文件中詳細說明的風險和不確定性。請注意，我們公司的實際結果可能與預期存在重大差異，我們不承擔更新這些聲明的義務。我們的 2023 年第三季度收益報告中提供了某些非 GAAP 財務指標與其相應 GAAP 指標的對賬，該報告可在我們的投資者關係網站 www.investorsacuitybrands.com 上查閱。

With me this morning is Neil Ashe, our Chairman, President and Chief Executive Officer, who will provide an update on our strategy and our third quarter highlights; and Karen Holcom, our Senior Vice President and Chief Financial Officer, who will walk us through our fiscal third quarter financial performance. There will be an opportunity for Q&A at the end of this call. (Operator Instructions) We are webcasting today's conference call live. Thank you for your interest in Acuity Brands. I will now turn the call over to Neil Ashe.

今天早上與我在一起的是我們的董事長、總裁兼首席執行官尼爾·阿什 (Neil Ashe)，他將介紹我們的戰略和第三季度亮點的最新情況；我們的高級副總裁兼首席財務官凱倫·霍爾科姆 (Karen Holcom) 將帶領我們了解第三財季的財務業績。本次電話會議結束時將有一個問答機會。 （操作員說明）我們對今天的電話會議進行網絡直播。感謝您對 Acuity Brands 的興趣。我現在將把電話轉給尼爾·阿什。

Thank you, Charlotte, and welcome to all of you joining us this morning. In the third quarter of fiscal 2023, we expanded adjusted operating profit margin both sequentially and year-over-year. We continue to grow adjusted diluted EPS, and we generated strong cash flow from operations despite a decline in net sales. We completed the acquisition of KE2 Therm and we continue to repurchase our shares. We are making meaningful progress in both our Lighting and Spaces businesses.

謝謝你，夏洛特，歡迎大家今天早上加入我們。在 2023 財年第三季度，我們調整後的營業利潤率環比和同比均有所擴大。我們的調整後攤薄每股收益繼續增長，儘管淨銷售額下降，但我們仍從運營中產生了強勁的現金流。我們完成了對 KE2 Therm 的收購，並繼續回購我們的股票。我們在照明和空間業務方面都取得了有意義的進展。

In the Acuity Brands' Lighting and Lighting Controls business, our strategy is clear: increase product vitality, increase service levels and use technology to improve and differentiate both our products and our services. This quarter, we launched Design Select. We developed Design Select to elevate our service for the specification community by making it easy for them to choose superior solutions with dependable service. Design Select consists of 3,000 configurable products that meet important specification needs from some of our core families of lighting and lighting control brands, including Aculux, Gotham, Lithonia Lighting, nLight and SensorSwitch.

在 Acuity Brands 的照明和照明控制業務中，我們的戰略很明確：提高產品活力、提高服務水平並利用技術來改進和區分我們的產品和服務。本季度，我們推出了 Design Select。我們開發 Design Select 是為了提升我們為規範社區提供的服務，使他們能夠輕鬆選擇具有可靠服務的卓越解決方案。 Design Select 包含 3,000 種可配置產品，可滿足我們一些核心照明和照明控製品牌系列的重要規格需求，包括 Aculux、Gotham、Lithonia Lighting、nLight 和 SensorSwitch。

Design Select is an important addition to our service strategy. ABL Lighting and Lighting Control products are now organized into 3 clear categories: Contractor Select is 300 of the most important everyday lighting and lighting control products available in stock at retailers and electrical distributors; Design Select is 3,000 configurable products that meet the key choices of lighting specifiers with dependable service; and the remainder is made to order.

Design Select 是我們服務策略的重要補充。 ABL 照明和照明控制產品現在分為 3 個明確的類別： Contractor Select 是零售商和電氣經銷商庫存中的 300 種最重要的日常照明和照明控制產品； Design Select 包含 3,000 種可配置產品，可通過可靠的服務滿足照明規範制定者的關鍵選擇；其餘部分按訂單生產。

Through the combination of high product vitality and improved service levels with the specification community, distributors and contractors, we continue to differentiate ourselves and challenge the existing industry standards.

通過將高產品活力和改進的服務水平與規範社區、分銷商和承包商相結合，我們不斷使自己脫穎而出並挑戰現有的行業標準。

We also continued to introduce new products during the quarter. Our Luminis brand launched the in-line family of exterior luminaires for use in plazas and arenas. Each light module can rotate 355 degrees and can be individually controlled, allowing installers to position the Luminaire on site for improved flexibility to create optimal illumination solutions.

本季度我們還繼續推出新產品。我們的 Luminis 品牌推出了用於廣場和競技場的直列式室外燈具系列。每個燈模塊都可以旋轉 355 度，並且可以單獨控制，允許安裝人員在現場定位燈具，以提高靈活性，以創建最佳的照明解決方案。

The recognition of our product vitality efforts is important to our team and our customers. And this quarter, several of our products won prestigious Red Dot Design Awards, including products from Luminis and Eureka. The Eureka Tangram-Trace was awarded a Red Dot Best of the Best distinction for its groundbreaking design. Other winners in this category included products from Apple, IBM and Sonos, and span categories from VR headsets to first responder drugs. We're proud to be in this company of innovators.

對我們產品活力努力的認可對於我們的團隊和客戶來說非常重要。本季度，我們的多款產品榮獲著名的紅點設計獎，其中包括 Luminis 和 Eureka 的產品。 Eureka Tangram-Trace 因其突破性設計榮獲紅點最佳設計獎。該類別的其他獲獎者包括來自 Apple、IBM 和 Sonos 的產品，涵蓋從 VR 耳機到急救藥物等多個類別。我們很自豪能夠加入這家創新公司。

Now moving to our Intelligent Spaces Group. This was a big quarter for our spaces team both at Distech and at Atrius. First, on Distech. Our strategic priority is to expand our addressable market, which we are doing in 2 ways. The first is geographic, which continues to progress successfully. The second is by increasing what we control in a built space.

現在轉到我們的智能空間組。對於 Distech 和 Atrius 的空間團隊來說，這是一個重要的季度。首先是 Distech。我們的戰略重點是擴大我們的目標市場，我們正在通過兩種方式做到這一點。第一個是地理領域，該領域繼續取得成功。第二是增加我們對建築空間的控制。

During the quarter, we announced the completion of the acquisition KE2 Therm, which allows us to expand Distech's addressable market by entering the commercial refrigeration control space. By controlling commercial refrigeration, we are able to more effectively sell the entire Distech portfolio in verticals like retail, restaurants and schools.

本季度，我們宣布完成對 KE2 Therm 的收購，這使我們能夠通過進入商用製冷控制領域來擴大 Distech 的潛在市場。通過控製商業製冷，我們能夠更有效地在零售、餐廳和學校等垂直領域銷售整個 Distech 產品組合。

The timing is significant as the refrigeration industry responds to the need for ultra low global warming potential refrigerant technologies. This has led to growing demand for transcritical CO2 solutions, which require the precision of digital controls to provide safety, efficiency and reliability while delivering cost savings to the customer.

隨著製冷行業滿足對超低全球變暖潛力製冷劑技術的需求，這一時機意義重大。這導致對跨臨界二氧化碳解決方案的需求不斷增長，這需要精確的數字控制來提供安全性、效率和可靠性，同時為客戶節省成本。

I now want to spend a few minutes on Atrius. Our strategy with Atrius has been to build a data layer that connects the edge to the cloud and use that data to develop applications that make a difference in built spaces. Earlier this month, we showcased our products at the IBcon 2023 Conference in Las Vegas. This is the largest smart building conference for commercial real estate and facilities companies.

我現在想花幾分鐘討論 Atrius。我們與 Atrius 的戰略是構建一個將邊緣連接到雲的數據層，並使用該數據開發能夠改變建築空間的應用程序。本月早些時候，我們在拉斯維加斯舉行的 IBcon 2023 會議上展示了我們的產品。這是商業地產和設施公司規模最大的智能建築會議。

At IBcon, we launched Atrius DataLab, a powerful data layer that supports a portfolio of Atrius applications that is foundational to our ability to automate the environment of a built space. Atrius Data Lab captures data from a building management system and organizes it in the cloud. From there, it harmonizes the data for accessibility and usefulness and creates a digital twin. Applications are built on top of that digital twin, allowing users to analyze historic scenarios, get live updates of the current building environment and model other scenarios.

在 IBcon 上，我們推出了 Atrius DataLab，這是一個強大的數據層，支持 Atrius 應用程序組合，這是我們實現建築空間環境自動化的能力的基礎。 Atrius 數據實驗室從建築管理系統捕獲數據並將其組織在雲中。從那裡，它協調數據的可訪問性和有用性，並創建數字孿生。應用程序構建在數字孿生之上，允許用戶分析歷史場景、獲取當前建築環境的實時更新並對其他場景進行建模。

This service is important because every building is different. Our Atrius applications have been built to ensure that our partners achieve their specific energy and sustainability goals through the collection, measurement and management of data in each of their built spaces.

這項服務很重要，因為每棟建築都不同。我們的 Atrius 應用程序旨在確保我們的合作夥伴通過收集、測量和管理每個建築空間中的數據來實現其特定的能源和可持續發展目標。

Atrius Sustainability and Atrius Energy are live and were built on the foundation of Atrius Building Insights. Atrius Sustainability is an automation tool that captures, categorizes and reports on carbon emissions within built spaces. Atrius Energy facilitates the reduction of energy and carbon usage by allowing facilities teams to benchmark their usage against Science Based Targets. Later this year, our team will be rolling out Atrius Facilities and Atrius [Resolve].

Atrius Sustainability 和 Atrius Energy 已上線，並建立在 Atrius Building Insights 的基礎上。 Atrius Sustainability 是一種自動化工具，可捕獲、分類和報告建築空間內的碳排放。 Atrius Energy 允許設施團隊根據科學目標對其使用情況進行基準測試，從而促進減少能源和碳的使用。今年晚些時候，我們的團隊將推出 Atrius Facilities 和 Atrius [Resolve]。

Now looking to the remainder of fiscal 2023. Our third quarter played out as expected with sales being impacted by both lead time normalization and the macro environment. Entering our fourth quarter, we believe that there will be a continuation of these trends. While our order rates and our shipment rates are returning into closer alignment with each other, we have not yet returned to normal sequential seasonality.

現在展望 2023 財年的剩餘時間。我們的第三季度業績符合預期，銷售受到交貨時間正常化和宏觀環境的影響。進入第四季度，我們相信這些趨勢將持續下去。雖然我們的訂單率和發貨率正在恢復到彼此更加接近的水平，但我們尚未恢復到正常的連續季節性。

In ABL, we are going to focus on strategic pricing, continued productivity improvements and managing material costs. In ISG, we're going to focus on the continued growth of Distech and Atrius and the successful integration of KE2 Therm. We will continue to prioritize managing margin, generating strong cash flow and allocating capital effectively.

在 ABL，我們將重點關注戰略定價、持續提高生產力和管理材料成本。在 ISG，我們將重點關注 Distech 和 Atrius 的持續增長以及 KE2 Therm 的成功整合。我們將繼續優先考慮管理利潤、產生強勁的現金流和有效地配置資本。

Now I'll turn the call over to Karen, who will update you on our third quarter performance.

現在我將把電話轉給凱倫，她將向您介紹我們第三季度業績的最新情況。

Thank you, Neil, and good morning to everyone on the call. In the third quarter of 2023, we delivered sequential and year-over-year adjusted operating profit margin improvement despite a decline in net sales. We grew adjusted diluted earnings per share and generated strong cash flow from operations. For total AYI, we generated net sales of $1 billion, which was 6% lower than the prior year as a result of the decline in net sales in our ABL business. As Neil described, this was the result of lower volumes, consistent with lead time normalization trends and the impact of the wider macro environment.

謝謝你，尼爾，祝所有參加電話會議的人早上好。 2023 年第三季度，儘管淨銷售額下降，但我們實現了環比和同比調整後營業利潤率的改善。我們增長了調整後的稀釋每股收益，並產生了強勁的運營現金流。對於 AYI 總額，我們的淨銷售額為 10 億美元，由於 ABL 業務淨銷售額下降，比上年下降 6%。正如尼爾所描述的，這是銷量下降的結果，與交貨時間正常化趨勢和更廣泛的宏觀環境的影響一致。

As we made clear on our last call, our focus is on delivering margin and operating cash flow. During the quarter, both operating profit and adjusted operating profit were flat on lower sales. We expanded adjusted operating profit margin to 16.3%, which was an increase of approximately 100 basis points over the prior year and an improvement of 230 basis points sequentially, driven by the improvement in gross profit margin. During the quarter, our adjusted diluted earnings per share of $3.75 increased $0.23 or 7% over the prior year.

正如我們在上次電話會議中明確表示的那樣，我們的重點是提供利潤和運營現金流。本季度，由於銷售額下降，營業利潤和調整後營業利潤均持平。在毛利率改善的推動下，我們將調整後營業利潤率擴大至 16.3%，比上年增加約 100 個基點，環比提高 230 個基點。本季度，我們調整後的稀釋每股收益為 3.75 美元，比上年增加 0.23 美元，即 7%。

Moving to our segment performance review. ABL net sales were $941 million in the quarter. This decrease of 7% compared with the prior year was largely driven by declines in the independent sales network and lower OEM sales. This was partially offset by infrastructure projects in the direct sales network and continued strong performance in our retail channel.

轉向我們的部門績效審查。 ABL 本季度淨銷售額為 9.41 億美元。與上年相比下降 7%，主要是由於獨立銷售網絡的下降和 OEM 銷售額的下降。這部分被直銷網絡的基礎設施項目和零售渠道的持續強勁表現所抵消。

ABL's operating profit and adjusted operating profit were both flat on lower net sales, and we delivered adjusted operating profit margin of 17%, a 120 basis point improvement over the prior year and a 200 basis point improvement sequentially as price held and material input costs improved, particularly steel and inbound freight.

由於淨銷售額下降，ABL 的營業利潤和調整後營業利潤均持平，調整後營業利潤率為 17%，比上年提高 120 個基點，隨著價格保持和材料投入成本改善，環比提高 200 個基點，特別是鋼鐵和入境貨運。

The spaces segment continued to perform well with another good quarter. Sales were $66 million, an increase of 13% as both Distech and Atrius continued to grow. Spaces' operating profit was $9 million and adjusted operating profit was $13 million as we continued to invest in the business for longer-term growth.

空間業務繼續表現良好，季度表現良好。隨著 Distech 和 Atrius 的持續增長，銷售額達到 6600 萬美元，增長了 13%。 Spaces 的營業利潤為 900 萬美元，調整後的營業利潤為 1300 萬美元，因為我們繼續投資該業務以實現長期增長。

Now moving to our cash flow performance. We generated $472 million of cash flow from operating activities for the first 9 months of fiscal 2023, an increase of $306 million over the same period in 2022, driven largely by improvements in working capital. We have improved both days of inventory and accounts receivable compared to the end of the year.

現在轉向我們的現金流表現。 2023 財年前 9 個月，我們的經營活動產生了 4.72 億美元的現金流，比 2022 年同期增加了 3.06 億美元，這主要是由於營運資本的改善。與年底相比，我們的庫存天數和應收賬款都有所改善。

As we've discussed on prior calls, we've continued to bring inventory down by 22 inventory days from the peak in February 2022, and we've also brought inventory levels down by over $36 million sequentially from the second quarter of fiscal 2023.

正如我們在之前的電話會議中討論的那樣，我們繼續將庫存比 2022 年 2 月的峰值減少了 22 個庫存天，並且我們還使庫存水平比 2023 財年第二季度連續減少了超過 3600 萬美元。

Year-to-date, we invested $48 million in capital expenditures and allocated $219 million to repurchase approximately 1.3 million shares. Our capital allocation priorities remain the same. We have invested for growth in our current businesses through R&D and CapEx. We've expanded our platform through acquisitions, as evidenced by the purchase of OPTOTRONIC in our lighting business and KE2 Therm in our spaces business.

年初至今，我們投資了 4800 萬美元的資本支出，並撥款 2.19 億美元用於回購約 130 萬股股票。我們的資本配置優先事項保持不變。我們通過研發和資本支出投資於當前業務的增長。我們通過收購擴大了我們的平台，例如在我們的照明業務中購買 OPTOTRONIC 並在我們的空間業務中購買 KE2 Therm。

We've maintained our dividend, and we've created permanent shareholder value with approximately $1.2 billion share repurchases since the fourth quarter of fiscal 2020 at an average price of approximately $142 per share, which was funded by organic cash flow.

自 2020 財年第四季度以來，我們維持了股息，並通過約 12 億美元的股票回購創造了永久股東價值，平均價格約為每股 142 美元，資金來源為有機現金流。

To summarize our performance for the quarter. We delivered strong margin and cash flow despite sales being down year-over-year. Based on year-to-date results and our expectations for the fourth quarter, we now expect full year net sales to be between $3.9 billion and $4 billion. Our expectations for full year adjusted diluted earnings per share have not changed. Our focus continues to be on meeting the needs of our customers and delivering margin and cash flow.

總結我們本季度的業績。儘管銷售額同比下降，但我們仍實現了強勁的利潤率和現金流。根據今年迄今的業績和我們對第四季度的預期，我們現在預計全年淨銷售額將在 39 億美元至 40 億美元之間。我們對全年調整後稀釋每股收益的預期沒有改變。我們的重點仍然是滿足客戶的需求並提供利潤和現金流。

Thank you for joining us today. I will now pass you over to the operator to take your questions.

感謝您今天加入我們。現在我將把您轉交給接線員回答您的問題。

(Operator Instructions) Our first question comes from Tim Wojs with Baird.

（操作員說明）我們的第一個問題來自 Baird 的 Tim Wojs。

Maybe just to start out on the market. I appreciate kind of the color around kind of order rates and shipment rates and kind of how those are normalizing. I was curious if there was any way to kind of break that out by the channel or segmentation, whether it's kind of the project business or what you're seeing on the stock and flow side and then maybe some of your more direct accounts?

也許只是為了進入市場。我很欣賞訂單率和發貨率的顏色以及它們如何正常化。我很好奇是否有任何方法可以通過渠道或細分來打破這一點，無論是項目業務還是您在庫存和流量方面看到的內容，然後也許是您的一些更直接的帳戶？

Yes. Tim, so let me start from kind of back to front. So first, on the corporate accounts and on the OEM side, that's where those are obviously going to be volatile, and those are down and those order rates are relatively low. There's lots of reasons for those, the timing of renovations at our big customers on the corporate account side; and then second, on the OEM side, there's probably some continued destocking going down in the driver market.

是的。蒂姆，讓我從後到前開始。因此，首先，在企業客戶和 OEM 方面，這些顯然會波動，而且這些客戶和訂單率都相對較低。造成這些的原因有很多，我們的大客戶在企業客戶方面的裝修時機；其次，在 OEM 方面，驅動器市場可能會持續減少庫存。

Then as you kind of get to our direct sales network and our project business, that's where the C&I order rate is relatively stable at this point. So -- and our direct sales is also consistent. So they're finding a level here where they're relatively consistent. And then finally, we've had continued strong performance in retail. So when you blow it all back together, I think it's a continuation of the trends we've seen from this quarter and looking out to what we can see right in front of us.

然後，當您進入我們的直銷網絡和項目業務時，這就是此時 C&I 訂單率相對穩定的地方。所以——我們的直接銷售也是一致的。所以他們在這裡找到了一個相對一致的水平。最後，我們在零售業的表現持續強勁。因此，當你把這一切重新組合在一起時，我認為這是我們從本季度看到的趨勢的延續，並展望我們可以在我們面前看到的情況。

Okay. And I guess, like as you mentioned in your prepared remarks that you're not really quite back to normal revenue seasonality yet. I mean, is there any kind of expectation or thought when you might be back to that kind of normal seasonality?

好的。我想，就像您在準備好的評論中提到的那樣，您還沒有真正完全恢復正常的收入季節性。我的意思是，當你可能回到那種正常的季節性時，是否有任何期望或想法？

Yes. We're not ready to call that yet, Tim, as we sort our way through this. I mean, we're looking at the same kind of windshield metrics that you are to try and understand. So because we haven't gone through a period that looks like this one, we don't have a perfect proxy for where that is. So we're, at this point, going to take it one quarter at a time.

是的。蒂姆，我們還沒準備好這麼稱呼，因為我們正在解決這個問題。我的意思是，我們正在研究與您要嘗試和理解的相同類型的擋風玻璃指標。因此，因為我們還沒有經歷過像現在這樣的時期，所以我們沒有一個完美的代理來判斷這一時期的情況。所以，此時我們將一次進行一個季度。

Okay, okay. Makes sense. And then just the last one, and this is maybe more of a bigger picture question. Just with how you're bucketing sales with just under the Contractor Select, the Design Select and kind of the MTO products. I mean, I guess, could you talk about what's different with that segmentation versus before? And if you're aligning it this way, does that have more of a top line sales impact for you, just easier to order? Or is that more of a benefit to margins because maybe it eliminates a lot of, like cats and dogs on some of the products?

好吧好吧。說得通。然後是最後一個，這可能是一個更大的問題。就像您如何通過承包商選擇、設計選擇和 MTO 產品類型來進行銷售一樣。我的意思是，我想，您能談談這種細分與以前相比有什麼不同嗎？如果您以這種方式進行調整，是否會對您的營收產生更大的影響，並且更容易訂購？或者這對利潤率更有好處，因為它可能消除了很多東西，比如某些產品上的貓和狗？

Yes. So I think the delineation -- the clarity of the delineation is powerful on a number of levels. First, as you know we've had a lot of success for Contractor Select. So building a product of 300 SKU product line that's built for stocking and resale and retail and electrical distribution provides us the ability to be very -- have very high product vitality, have very high service levels and be an important partner to the retail and electrical distribution industry, and it allows us to compete effectively with whoever wants to enter the market through that channel. So that's been a real success for us.

是的。所以我認為這種劃分——清晰的劃分在很多層面上都是強大的。首先，如您所知，我們在承包商選擇方面取得了很大的成功。因此，構建一個專為庫存和轉售以及零售和電氣分銷而設計的 300 SKU 產品線，使我們能夠擁有非常高的產品活力、非常高的服務水平，並成為零售和電氣行業的重要合作夥伴。分銷行業，它使我們能夠與任何想通過該渠道進入市場的人進行有效競爭。所以這對我們來說是真正的成功。

Design Select is then about configurable products for the specification community. And what this allows them to do is choose -- basically make good choices among the product families. So this is the next step in that process. So our expectations aren't that this creates a new line of revenue, but it is -- our expectations are that we will create a lot more efficiency for them as well as for us. And then finally, we can isolate made to order. So when we isolate made to order, then we can treat it as such, which is made to order. And we can price it accordingly, we can -- and we can service it accordingly.

設計選擇是關於規範社區的可配置產品。這讓他們能夠做的是選擇——基本上是在產品系列中做出好的選擇。這是該過程的下一步。因此，我們的期望並不是這會創造新的收入來源，而是——我們的期望是我們將為他們和我們創造更高的效率。最後，我們可以隔離定制產品。因此，當我們隔離定制訂單時，我們可以將其視為定制訂單。我們可以相應地定價，我們可以——而且我們可以相應地為它提供服務。

So that's the import of creating those different buckets, is ultimately that we're trying to make the light and lighting control business more predictable, repeatable and scalable.

因此，這就是創建這些不同類別的重要性，最終是我們試圖使燈光和照明控制業務更加可預測、可重複和可擴展。

Our next question comes from Joe O'Dea with Wells Fargo.

我們的下一個問題來自富國銀行的 Joe O'Dea。

Wanted to start on the margin front. Really strong gross margins during the quarter. I think just sort of if you could unpack a little bit on the price/cost dynamic. And maybe if we go back a couple of years, you were talking about a gross margin target of around 42%. It looks like you should be north of 43% this year. So how do we think about the sustainability of that? And then what you might be seeing on the price side, any sort of incoming pressure you're seeing there?

想從邊緣開始。本季度毛利率確實強勁。我想如果你能稍微了解一下價格/成本動態的話就可以了。也許如果我們回到幾年前，您談論的毛利率目標約為 42%。看來今年您的得分應該超過 43%。那麼我們如何看待這種做法的可持續性呢？然後你可能會在價格方面看到什麼，你在那裡看到的任何類型的壓力？

Joe, thanks for the question this morning. I'll start and then I'll pass it over to Neil to add on. So as we talked about on the call, at ABL, we're really focused on strategic pricing, continued productivity improvements and managing material costs. So again we've demonstrated discipline in all these areas this year, which is resulting in the strong gross margin that you see in the quarter, and that's going to continue to be our focus. And the other thing I would add is that we're having continued growth at ISG, and so that's helping us as well.

喬，謝謝你今天早上提出的問題。我先開始，然後將其交給尼爾補充。正如我們在電話會議上談到的，在 ABL，我們真正關注的是戰略定價、持續提高生產力和管理材料成本。因此，今年我們再次在所有這些領域表現出了紀律，這導致了您在本季度看到的強勁毛利率，這將繼續成為我們的重點。我要補充的另一件事是，我們 ISG 正在持續增長，這也對我們有幫助。

Yes. And I would only build on that a little bit, Karen. I think you summarized it well to say that, Joe, I think we have made an improvement from where we were when we were targeting the 42%. So clearly, we've improved the business since then. And I would just pick up on 2 things that Karen pointed out there. First, around strategic pricing, so that's where on the Contractor Select portfolio, we can compete with anyone that wants to enter the market through those channels, which is very effective. And we can choose which projects we want to participate in based on pricing. So we're significantly more strategic about how we're pricing.

是的。我只會在此基礎上進一步發展，凱倫。我認為你總結得很好，喬，我認為我們已經比我們目標 42% 時的情況有所改進。很明顯，從那時起我們已經改善了業務。我只想了解凱倫在那裡指出的兩件事。首先，圍繞戰略定價，這就是承包商精選投資組合的一部分，我們可以與任何想要通過這些渠道進入市場的人競爭，這是非常有效的。我們可以根據定價選擇我們想要參與的項目。因此，我們在定價方面更具戰略性。

Second is that we're really working hard, and our teams have done a nice job on the combination of productivity improvements and material cost savings. That's a combination of our product vitality efforts and the work that we're doing in our supply chain to level load. And then finally, I'd emphasize that the continued growth of ISG is growth accretive, margin accretive and returns accretive.

其次，我們真的很努力，我們的團隊在提高生產力和節省材料成本方面做得很好。這是我們在產品活力方面所做的努力以及我們在供應鏈中為平衡負載所做的工作的結合。最後，我要強調的是，ISG 的持續增長是增長增值、利潤增值和回報增值。

And then just a question related to outlook, both this year and next. I think this year, the earnings outlook, sounds like maintaining that but it's $1.50 range. And so any anything that you would talk to in terms of what's most likely within a narrowing of that band? And then as you think about a '24 guide in a few months, Neil, just what are sort of the most important watch items for you over the next few months to sort of inform how you'd be thinking about that outlook?

然後是一個與今年和明年的前景相關的問題。我認為今年的盈利前景聽起來會維持不變，但范圍是 1.50 美元。那麼，您是否會談論在該範圍縮小範圍內最有可能發生的事情？然後，當你在幾個月後考慮 24 小時指南時，尼爾，在接下來的幾個月裡，對你來說最重要的觀察項目是什麼，可以告訴你如何看待這一前景？

Yes. So let me contextualize first and then I'll dig in to answer the specifics of your question. We -- as we've said consistently, our plan is to provide annual guidance and not update that guidance through the year. We felt it important to identify for you that we weren't going to meet the lower end of our net sales guidance for the year, but we still are in the adjusted EPS range that we gave at the beginning of the year.

是的。因此，讓我先了解一下背景，然後我會深入回答您問題的具體內容。正如我們一直所說，我們的計劃是提供年度指導，而不是全年更新該指導。我們認為有必要向您表明，我們不會達到今年淨銷售額指導的下限，但我們仍處於年初給出的調整後每股收益範圍內。

And to be transparent, we're proud of that. So this has been a -- our teams have done really hard work to deliver the results that we're delivering this year to maintain dollar profit margin on lower sales, to increase margins, et cetera. So we feel really good about that.

坦白說，我們對此感到自豪。因此，我們的團隊做了非常艱苦的工作來實現今年的目標，以在銷售額下降的情況下維持美元利潤率，提高利潤率等等。所以我們對此感覺非常好。

As we look forward to '24, as I said, we're going to take this one quarter at a time for right now. So we're not going to get too far ahead of ourselves on predicting '24. Our general indications are that the rest of this calendar year feels like it's going to be similar trends that we're having now, that could change. And we're confident in our ability to continue to grow the ISG business and then some of the growth initiatives that we're planning for ABL going forward.

正如我所說，當我們期待 24 週年時，我們現在將一次只進行一個季度。因此，我們在預測“24”時不會太過超前。我們的總體跡像是，今年剩下的時間感覺將與我們現在所經歷的趨勢類似，但可能會發生變化。我們對繼續發展 ISG 業務以及我們為 ABL 規劃的一些增長計劃的能力充滿信心。

So our priority, as we've said through this environment, is to layer in margin, which we've demonstrated that we're doing. Whether or not we have sales growth, we're trying to layer in margin. We're trying to continue to deliver free cash flow, and we've delivered a ton of it, and we're going to continue to grow the Intelligent Spaces Group.

因此，正如我們在當前環境中所說的那樣，我們的首要任務是增加利潤，我們已經證明了我們正在這樣做。無論我們的銷售額是否增長，我們都會努力提高利潤率。我們正在努力繼續提供自由現金流，我們已經提供了大量的自由現金流，我們將繼續發展智能空間集團。

Our next question comes from Ryan Merkel with William Blair.

我們的下一個問題來自瑞安·默克爾和威廉·布萊爾。

I wanted to pick up on the orders again. Just sort of clear it, it sounds like orders are tracking sort of down mid-single digits, and you mentioned lead times and the macro. Can you just unpack those a little bit more? Is it distributor destocking? Is it tighter credit? What are some of the factors that are impacting the order rate decelerating a little bit here?

我想再次接訂單。只是澄清一下，聽起來訂單量正在下降中個位數，並且您提到了交貨時間和宏觀。你能把它們再拆開一點嗎？是經銷商去庫存嗎？信貸收緊了嗎？影響訂單率略有下降的因素有哪些？

Yes. I will take a shot at that and, Karen, fill in any gaps that I leave in the explanation. So first, just to reiterate the bigger picture here. So looking back to last year, we had a combination of longer lead times and a price increase environment, which basically pulled forward a lot of orders. So we had a swelled backlog and we've been working through that backlog through this year. And through this quarter, it's starting to be back to about normal.

是的。我會嘗試一下，凱倫，請填補我在解釋中留下的任何空白。首先，重申一下大局。所以回顧去年，我們有較長的交貨時間和價格上漲的環境，這基本上拉動了很多訂單。因此，我們的積壓訂單不斷增加，今年我們一直在努力解決這些積壓訂單。在本季度，情況開始恢復正常。

So which means that in any period, we will basically ship what's ordered. So over the long arc of time, obviously, we will. But in a normal quarter, we will ship generally what's ordered in that quarter and a little bit from the quarter before. So we're starting to get to kind of more normalized levels there. On the positive side, those numbers are relatively consistent, absent volatility of the corporate accounts and the OEM, which I discussed in the first question.

所以這意味著在任何時期，我們基本上都會按訂單發貨。因此，在很長一段時間內，顯然我們會這樣做。但在正常的季度中，我們通常會發貨該季度訂購的商品，並從前一季度訂購少量商品。因此，我們開始達到更加標準化的水平。從積極的一面來看，這些數字相對一致，沒有公司賬戶和 OEM 的波動，這一點我在第一個問題中討論過。

So that's -- we feel good about kind of where we are on that front. So as you look forward off of that, then the quarters as the next one, and this is why we're saying we're taking this one quarter at a time will be impacted by kind of normal macroeconomic trends. And I don't think -- we're looking at the same data you are, and we don't pretend to have a crystal ball.

所以，我們對我們在這方面的進展感覺良好。因此，當您展望這一點時，然後是下一個季度，這就是為什麼我們說我們每次只考慮這一季度將受到正常宏觀經濟趨勢的影響。我不認為——我們正在研究與您相同的數據，並且我們不會假裝擁有水晶球。

So our focus there is that we're going to -- or continue to get every piece of business we can get. All indications are from all of our data sources that we're either holding or taking share and we'll continue to try and layer in margin and deliver free cash flow in this environment.

因此，我們的重點是我們將——或者繼續獲得我們能獲得的每一項業務。所有跡象均來自我們所有的數據來源，表明我們要么持有或持有股份，我們將繼續嘗試在這種環境下增加保證金並提供自由現金流。

Got it. That's helpful. And then another question I had was on project releases. I was hearing that tighter credit and shortage of switch gear was delaying the releases of projects. Are you guys seeing that? And any visibility as to when maybe that gets a little bit better?

知道了。這很有幫助。我的另一個問題是關於項目發布的。我聽說信貸緊縮和開關設備短缺導致項目的發布被推遲。你們看到了嗎？是否知道什麼時候情況會好一點？

Yes. So I'll take switchgear and then projects. First on switch gear. The lead times, as we understand it, have not yet -- have not compressed for switch gears. So just to put that in context, they were in the kind of 50-week range, so not days, weeks range. So they have been the bottleneck on many of the already funded projects. So that's the switch gear thing.

是的。所以我會先學習開關設備，然後進行項目。首先打開開關裝置。據我們了解，開關設備的交貨時間尚未壓縮。因此，就具體情況而言，它們是在 50 週的範圍內，而不是幾天、幾週的範圍。因此，它們一直是許多已資助項目的瓶頸。這就是開關裝置的事情。

Those will -- all those projects will continue to happen. And now that our lead times are basically normal, our expectation is that they will order their lighting for those projects on a more normal schedule. So that should play out over a while.

這些將——所有這些項目將繼續進行。現在我們的交貨時間基本正常，我們的期望是他們會按照更正常的時間表為這些項目訂購照明。所以這應該會持續一段時間。

In terms of new projects, that's really -- from our perspective, that's the macro environment. So with higher rates, I think everyone is going to relook at their projects. And so anecdotally, we have projects that are -- we have a fair number of projects in our independent sales network that are in queue, but they're being changed, modified, kind of reevaluated, those sorts of things, which is frankly normal. It's not abnormal.

就新項目而言，從我們的角度來看，這確實是宏觀環境。因此，隨著利率的提高，我認為每個人都會重新審視他們的項目。有趣的是，我們的項目是——我們的獨立銷售網絡中有相當多的項目正在排隊，但它們正在被改變、修改、重新評估，諸如此類的事情，坦率地說，這是正常的。這並不異常。

But it doesn't make it clear exactly what the market size is going to be, which is why again we're taking it quarter by quarter and we're focused on kind of layering the margins, delivering cash flow.

但它並沒有明確說明市場規模將會有多大，這就是為什麼我們再次按季度進行分析，並且我們專注於分層利潤、提供現金流。

Our next question comes from the line of Chris Snyder with UBS.

我們的下一個問題來自瑞銀集團的克里斯·斯奈德。

So the last couple of quarters, we've seen very significant 300 basis points gross margin expansion, but also pretty steep volume declines. And I know there's destocking headwinds. But is there a negative volume impact in response to the company's increased focus on margins? And Neil, I would just be interested in hearing about how you think about that trade-off and why the focus on margins is the right one for Acuity.

因此，在過去的幾個季度中，我們看到毛利率顯著增長了 300 個基點，但銷量也大幅下降。我知道存在去庫存的阻力。但是，公司對利潤率的日益關注是否會對銷量產生負面影響？尼爾，我只是有興趣聽聽您如何看待這種權衡，以及為什麼關注利潤對於 Acuity 來說是正確的選擇。

Yes. So I'll happily address that. And from our perspective, the -- we're very clear with our company on how we create value. We grow net sales, we turn profits into cash and we don't grow the balance sheet as fast. So as we look out strategically around price, volume, et cetera, our objective with the lighting, lighting control business is to be predictable, repeatable and scalable and we're delivering on that.

是的。所以我很樂意解決這個問題。從我們的角度來看，我們對公司如何創造價值非常清楚。我們增加淨銷售額，將利潤轉化為現金，但資產負債表的增長速度卻沒有那麼快。因此，當我們圍繞價格、銷量等進行戰略性關注時，我們照明、照明控制業務的目標是可預測、可重複和可擴展，我們正在實現這一目標。

So in the current environment, you're right, and Karen has indicated this on other call, that we have had more price than volume over the course of kind of this year. So -- and that's a combination of kind of all of the factors we've talked about before. And that is delivering the results that we are seeing.

因此，在當前環境下，你是對的，凱倫在其他電話會議上也指出了這一點，今年我們的價格超過了銷量。所以——這是我們之前討論過的所有因素的結合。這正在帶來我們所看到的結果。

We also have all indications from our external sources that we're either maintaining or taking share in the process. So we're trying to guide the company to -- or steer the company to, as I said, this ability to be more predictable, repeatable and scalable in this business. So we do think these are the right choices. That is how we will create value. We'll grow net sales, we'll turn profits into cash and we won't grow the balance sheet as fast. And we're demonstrating that we can do that in a number of different market environments.

我們還從外部來源獲得了所有跡象，表明我們正在維持或分享這一過程。因此，我們正在努力引導公司——或者引導公司，正如我所說，在這項業務中變得更加可預測、可重複和可擴展。所以我們確實認為這些是正確的選擇。這就是我們創造價值的方式。我們將增加淨銷售額，將利潤轉化為現金，但資產負債表的增長速度不會那麼快。我們正在證明我們可以在許多不同的市場環境中做到這一點。

We succeeded through the challenge of the pandemic when it was -- when things fell off. We succeeded when they shot up. And now I believe we're succeeding as we try and return to some normalized marketing -- or market environment.

當疫情形勢惡化時，我們成功地應對了疫情的挑戰。當他們發射時我們就成功了。現在我相信，當我們嘗試回歸正常化的營銷或市場環境時，我們正在取得成功。

I appreciate that. And I wanted to follow up on the commentary around share gains, which is very impressive considering raising gross margin and taking share. I guess what gives you confidence that the company is taking share? Because I think investors see construction markets up 20% on the nonres side and obviously ABL down 7%. So how do we -- obviously, a big lag there. How should we think about -- or how do you guys think about the impact from the destock within that versus the potential share shifts, which are maybe more structural in nature?

我很感激。我想跟進有關份額收益的評論，考慮到毛利率的提高和份額的增加，這是非常令人印象深刻的。我想是什麼讓您對公司正在搶占份額充滿信心？因為我認為投資者認為非房地產建築市場上漲了 20%，而 ABL 顯然下降了 7%。那麼我們如何——顯然，那裡有很大的滯後。我們應該如何考慮——或者你們如何看待去庫存的影響與潛在的份額變化的影響，後者本質上可能更具結構性？

Yes, sure. And so this is a -- this could be a soliloquy -- a long kind of PhD level soliloquy, but let me just kind of summarize it, that with the benefit of a lot of the data work that we've done, there is not a like-for-like correlation between the lighting industry and a specific same quarter external macro number that we can point to. That requires a basket to have any kind of a correlation and the correlations we've gotten are, kind of our squares of like 0.8. So we're in the good, not great range on the predictability of that. It takes multiples of those.

是的，當然。所以這是一個——這可能是一個獨白——一種很長的博士水平的獨白，但讓我總結一下，得益於我們所做的大量數據工作，有照明行業與我們可以指出的特定同季度外部宏觀數據之間沒有類似的相關性。這要求籃子具有任何類型的相關性，而我們得到的相關性是 0.8 左右的平方。因此，我們的可預測性處於良好但不是很大的範圍內。它需要這些的倍數。

The second is that our research has shown that generally, we are performing ahead of the general macroeconomic cycle, both for the good and for the not as good. So we're working through that now. So the direct answer to your question is there is -- it is not a surprise to us that those numbers would diverge the way you described it.

第二，我們的研究表明，總體而言，我們的表現領先於總體宏觀經濟周期，無論是好是壞。所以我們現在正在解決這個問題。因此，對你的問題的直接回答是——這些數字與你描述的方式有所不同，我們並不感到驚訝。

Second thing that I would highlight there is the difference between nominal and real in the construction data. So that also, to the last question, is consistent with our performance as well. So there's -- I wish there were a more algebraic kind of tied to external market data that would predict our results, but there isn't. It's a basket, and we're not surprised by the relationship between those numbers that you described.

我要強調的第二件事是施工數據中名義數據和實際數據之間的差異。因此，對於最後一個問題，這也與我們的表現一致。所以，我希望有一種與外部市場數據相關的更代數的類型來預測我們的結果，但沒有。這是一個籃子，我們對您所描述的這些數字之間的關係並不感到驚訝。

Our next question comes from the line of Brian Lee with Goldman Sachs.

我們的下一個問題來自高盛的布萊恩·李 (Brian Lee)。

I might have missed this, but -- and I hate to kind of beat a dead horse, but the lead time issue, could you elaborate a bit more maybe in quantitative terms just sort of where they are, where you want them to be, the sort of trajectory from here? And is it a purely destocking issue at the moment? Just maybe give us a frame of reference with some of the quantification, that would be helpful.

我可能錯過了這一點，但是——我討厭死馬，但是交貨時間問題，你能詳細說明一下，也許用定量的術語來說，就是它們在哪裡，你希望它們在哪裡，從這裡開始的軌跡是什麼樣的？目前這純粹是去庫存問題嗎？也許給我們一個帶有一些量化的參考框架，這會很有幫助。

Yes. Brian, we covered this in some detail on the last quarter call. So I'll summarize it now, which is that kind of at the end of last fiscal year, our lead times and days were in the 50s range and now they're in the 20s range. So basically, we've reduced lead times by about 30 days. So that resulted in a buildup of backlog kind of towards the end of last fiscal year that we've been working through this year.

是的。布萊恩，我們在上個季度的電話會議上對此進行了一些詳細介紹。所以我現在總結一下，在上一財年末，我們的交貨時間和天數在 50 秒的範圍內，現在在 20 秒的範圍內。基本上，我們將交貨時間縮短了大約 30 天。因此，這導致了我們今年一直在努力解決的上一財年末積壓的情況。

And correspondingly, obviously, a little bit of an order drought as projects have been -- and needs have been pulled forward. So that's the big picture view of that and why -- and also why we've identified that we're starting to come back into balance and that basically we ship what's ordered over kind of basically a 60-day period.

相應地，顯然，隨著項目和需求的推進，訂單出現了一點乾旱。這就是這個問題的大局觀以及原因——也是為什麼我們已經確定我們開始恢復平衡，並且基本上我們在 60 天的時間內運送訂購的產品。

Yes, Brian, the only thing I would add is that last year, if you recall, we had several price increases as well, and that resulted in some of that pull forward that Neil described in addition to the lead time.

是的，布萊恩，我唯一要補充的是，去年，如果你還記得的話，我們也有幾次價格上漲，這導致除了交貨時間之外，尼爾還描述了一些提前。

Okay. Fair enough. Yes. I appreciate that clarification. And then I guess second question I had, and thanks for bringing it up, Karen, just around the price. I know you guys have gone away from talking specifics on price. But as you alluded to, last year, price was a meaningful tailwind. Historically, price has generally been, I think, maybe a plus or minus kind of low single-digit type of number for you all.

好的。很公平。是的。我很欣賞這一澄清。然後我想我有第二個問題，謝謝你提出來，凱倫，就價格而言。我知道你們已經不再談論價格細節了。但正如您所提到的，去年，價格是一個有意義的推動力。我認為，從歷史上看，價格通常對你們所有人來說可能是一種加號或減號的低個位數類型的數字。

Is that kind of where we are in terms of back to being toward a more normal? And then in relation to that, you've had a decent amount of product vitality, You introduced some new stuff and the Design Select as well. So maybe any high-level sense you can provide as to the impact on mix and price just as you're introducing a lot of these new products as well?

這就是我們回歸正常的狀態嗎？與此相關的是，您已經擁有了相當多的產品活力，您還引入了一些新東西和設計選擇。那麼，在您推出大量此類新產品時，您是否可以提供有關對組合和價格的影響的任何高級感知？

Yes. Brian, I would just go back to our posture on strategic pricing that we talked about earlier. We have really focused on this discipline over the past couple of years. We talked about it with our Contractor Select portfolio, which is really a combination of 300 everyday lighting products that we're able to compete with the right product, the right place at the right price. So that gives us the ability to compete in a certain part of the market that a while ago we weren't able to compete in.

是的。布萊恩，我想回到我們之前討論過的戰略定價立場。在過去的幾年裡，我們非常關注這一學科。我們通過我們的承包商精選產品組合討論了這個問題，該產品組合實際上是 300 種日常照明產品的組合，我們能夠以合適的產品、合適的地點以合適的價格進行競爭。因此，這使我們有能力在市場的某個部分進行競爭，而不久前我們還無法參與競爭。

And then if you look on the project side of the business, our strategic approach there is that we're able to pick the projects that we want and just be more disciplined about our pricing overall. So that's really what's driving the pricing that we're seeing today.

然後，如果你看看業務的項目方面，我們的戰略方法是，我們能夠選擇我們想要的項目，並且對整體定價更加嚴格。所以這確實是推動我們今天看到的定價的因素。

(Operator Instructions) Our next question comes from the line of Jeffrey Sprague with Vertical Research.

（操作員說明）我們的下一個問題來自垂直研究的杰弗裡·斯普拉格（Jeffrey Sprague）。

A lot of ground covered. I want to go a little bit further back just into what you're seeing in kind of the renovation markets in general. You obviously addressed kind of what you see in corporate account level. But anything you could kind of add there on kind of the vertical markets within that? You think this is mostly kind of a function of rates squeezing out marginal projects? Or any other color there would be interesting.

覆蓋了很多地面。我想進一步回顧一下您在一般裝修市場中所看到的情況。您顯然解決了您在公司帳戶級別看到的問題。但是您可以在其中的垂直市場中添加什麼內容嗎？您認為這主要是利率擠壓邊際項目的結果嗎？或者任何其他顏色都會很有趣。

Sure, Jeff. At ABL, the sales decreases by vertical are really what you would expect to see. We had declines in Industrial. If you recall, last year, we had a lot of warehouse and logistics projects that were taking place. And then also, we're seeing declines in health care and commercial office due to the impact of the wider macro environment. So really, nothing -- kind of nothing surprising on the vertical front.

當然，傑夫。在 ABL，銷售額按垂直方向下降確實是您所期望看到的。工業板塊出現下滑。如果您還記得，去年我們正在進行很多倉庫和物流項目。此外，由於更廣泛的宏觀環境的影響，我們還看到醫療保健和商業辦公的下降。所以說真的，沒什麼——在垂直方面沒什麼令人驚訝的。

And on the renovation front, Jeff, I would say that change for us is good. So we've gotten a lot of questions about kind of what happens if the -- in the commercial office space or the commercial around the broader lending environment, valuations, et cetera. And so I would just use, I think everybody saw the Wall Street Journal article about the building on Market Street in San Francisco that had a $300 million valuation in 2019 and then was sold for $60 million recently.

在裝修方面，傑夫，我想說，改變對我們來說是件好事。因此，我們收到了很多關於如果在商業辦公空間或圍繞更廣泛的貸款環境的商業、估值等情況下會發生什麼的問題。所以我想，我想每個人都看過《華爾街日報》關於舊金山市場街這座建築的文章，該建築在 2019 年估值為 3 億美元，最近以 6000 萬美元的價格出售。

So while it's unpleasant experience for the capital side of that trade, the reality with that building is that it will now be reset at different rates, new tenants will move in and they will need to customize the space to what they want. And so they're going to need lighting and lighting controls. So that's kind of -- so that's anecdotally how renovation will play out for us over the next foreseeable future.

因此，雖然這對於該交易的資本方來說是不愉快的經歷，但該建築的現實情況是，它現在將以不同的價格重置，新租戶將搬入，他們需要根據自己的需求定制空間。因此他們需要照明和照明控制。有趣的是，這就是在下一個可預見的未來，翻新將如何為我們發揮作用。

Yes. And I guess that could be a 2- or 3-year process though, right, as kind of work from home and everything resettles. No great visibility on that, I would think. The -- could you just address a little bit more on -- also just on the price side. You were pretty explicit about managing the algorithm, right? And you've said it a couple of times, gross margin, lagging growth in the balance sheet to kind of leverage the capital base.

是的。我想這可能是一個 2 到 3 年的過程，對吧，就像在家工作一樣，一切都會重新安置。我認為這方面沒有很好的可見性。您能否多談談價格方面的問題。您對於管理算法非常明確，對吧？你已經說過好幾次了，毛利率、資產負債表的滯後增長是為了撬動資本基礎。

But do you see an environment emerging where it, in fact, would make sense in that algorithm to just kind of overtly seed share in the name of protecting margins and cash flow? And do you see that sort of competitive pressure brewing or starting to emerge anywhere?

但你是否看到一種環境正在出現，事實上，在這種算法中，以保護利潤和現金流的名義公開播種份額是有意義的？您是否看到這種競爭壓力正在醞釀或開始出現？

Yes, Jeff, the part of the reason we talk a lot about Contractor Select is that we have fundamentally changed our posture on product vitality. So we now have a product portfolio on a relatively consistent basis that is able to compete with all comers, and it allows us to deliver a margin at a price that's competitive in the marketplace. So that's a -- I think about the strategy around Contractor Select as really like what Kirkland is to Costco, Contractor Select is to the electrical distribution industry.

是的，傑夫，我們大量談論承包商選擇的部分原因是我們從根本上改變了我們對產品活力的態度。因此，我們現在擁有一個相對一致的產品組合，能夠與所有競爭者競爭，並且它使我們能夠以在市場上具有競爭力的價格提供利潤。因此，我認為圍繞承包商選擇的戰略就像柯克蘭之於好市多，承包商選擇之於配電行業。

In other words, it doesn't necessarily have to be the lowest priced product out there, but it is the highest value price and is competitive -- very competitive. That's allowed us to be in a very interesting position. And so we've tested this on price and whether we drive volume with price. And the -- and we've had really good results on that. So a little bit can go a long way there, which allows us to manage that.

換句話說，它不一定是價格最低的產品，但它是價值最高的產品，並且具有競爭力——非常有競爭力。這讓我們處於一個非常有趣的位置。因此，我們對價格以及是否以價格帶動銷量進行了測試。我們在這方面取得了非常好的成果。因此，一點點就可以起到很大的作用，這使我們能夠做到這一點。

And to your ultimate question about which one -- which would we choose, I don't think we will unnecessarily chase share if we think it's going to impact us negatively on our value-creation algorithm. So we are very competitive. We're comfortable with our position in the marketplace from a competitive perspective because of all the vitality and productivity improvements we've demonstrated. And so now we really want to -- we want to make the Lighting and Lighting Control business as predictable and repeatable and scalable as we can for a longer period of time, which would deliver value for a lot of us.

至於你的最終問題，即我們會選擇哪一個，我認為，如果我們認為這會對我們的價值創造算法產生負面影響，我們就不會不必要地追逐份額。所以我們非常有競爭力。從競爭的角度來看，我們對自己在市場中的地位感到滿意，因為我們已經展示了活力和生產力的提高。所以現在我們真的希望——我們希望使照明和照明控制業務在更長的時間內盡可能地可預測、可重複和可擴展，這將為我們很多人帶來價值。

And then I don't want to answer this question without also highlighting the importance of the Intelligent Spaces Group and our portfolio. So as you saw this quarter, we continue to grow with Distech, we continue to grow Atrius, we continue to find -- we are finding ways where we can put capital to work to make that business better.

然後，我不想在不強調智能空間集團和我們的產品組合的重要性的情況下回答這個問題。因此，正如您在本季度看到的那樣，我們繼續與 Distech 一起發展，我們繼續發展 Atrius，我們繼續尋找——我們正在尋找可以投入資本的方法，以使業務變得更好。

So then the whole company hopefully looks different going forward. The lighting business is more predictable and repeatable and scalable with an obvious value creation algorithm, and we're growing the technology business at ISG.

因此，整個公司有望在未來看起來有所不同。憑藉明顯的價值創造算法，照明業務更具可預測性、可重複性和可擴展性，我們正在 ISG 發展技術業務。

Thank you. And I'm showing no further questions in the queue at this time. I'd like to turn the call back to Neil Ashe for any closing remarks.

謝謝。目前我在隊列中沒有顯示任何其他問題。我想將電話轉回給尼爾·阿什，請他發表結束語。

Thank you, Liz. I'd like to thank all of you for joining us today. We appreciate the engagement and the questions. We had a solid quarter. We delivered margin and cash flow despite a decline in sales. We allocated capital effectively, and we continue to improve our underlying businesses. So thank you for your interest in Acuity Brands, and we look forward to seeing you again next quarter.

謝謝你，莉茲。我要感謝大家今天加入我們。我們感謝您的參與和提問。我們度過了一個穩定的季度。儘管銷售額下降，我們仍實現了利潤和現金流。我們有效配置資本，不斷完善基礎業務。感謝您對 Acuity Brands 的興趣，我們期待下季度再次見到您。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。