Commercial Vehicle Group Inc (CVGI) 2024 Q1 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the CVGIQ. one 2024 earnings call. At this time, all lines are in a listen only mode following the presentation, we will conduct a question and answer session. If at any time during this call you require assistance, please press star zero for the operator call. It being recorded on Tuesday, May seventh, 2024.

早安，女士們先生們，歡迎來到 CVGIQ。一場 2024 年財報電話會議。此時，所有線路均處於只聽模式，在演示結束後，我們將進行問答環節。如果在此通話期間您任何時間需要協助，請按星號零來撥打接線生電話。錄製於 2024 年 5 月 7 日星期二。

I would now like to turn the conference over to Mr. Andy Chang, Chief Financial Officer. Please go ahead, sir.

我現在請財務長張安迪先生主持會議。請繼續，先生。

Thank you, operator, and welcome, everyone to our conference call. Joining me on the call today is James Wey, President and CEO of CVG. This morning, we will provide a brief company update as well as commentary regarding our first quarter 2024 results, after which we will open the call for questions.

謝謝您，接線生，歡迎大家參加我們的電話會議。今天加入我電話會議的是 CVG 總裁兼執行長 James Wey。今天早上，我們將提供簡短的公司最新動態以及有關 2024 年第一季業績的評論，之後我們將開始提問。

As a reminder, this conference call is being webcast and the Q1 2024 earnings call presentation, which we will refer to during this call is available on our website. Both may contain forward-looking statements, including but not limited to, expectations for future periods regarding market trends cost-saving initiatives and new product initiatives among others. Actual results may differ from anticipated results because of certain risks and uncertainties. These risks and uncertainties may include, but are not limited to economic conditions in the markets in which CVG operates, fluctuations in the production volumes of vehicles for which CVG is a supplier, financial covenant compliance and liquidity risks associated with conducting business in foreign countries and currencies and other risks as detailed in our SEC filings.

謹此提醒，本次電話會議正在網路直播，我們將在本次電話會議期間參考的 2024 年第一季財報電話會議簡報可在我們的網站上查看。兩者都可能包含前瞻性陳述，包括但不限於對未來時期有關市場趨勢、成本節約措施和新產品措施等的預期。由於某些風險和不確定性，實際結果可能與預期結果不同。這些風險和不確定性可能包括但不限於 CVG 營運所在市場的經濟狀況、CVG 作為供應商的車輛產量的波動、與在國外開展業務相關的財務契約合規性和流動性風險以及我們向SEC 提交的文件中詳細介紹了貨幣和其他風險。

I will now turn the call over to James to provide a company update.

我現在將把電話轉給詹姆斯，以提供公司的最新情況。

Thank you, rarely.

謝謝，很少見。

I'd like to turn your attention to the supplemental earnings presentation starting on Slide 3. As we discussed in last quarter's call, we launched restructuring initiatives, comprehending softer market conditions that were expected and we continue to expect in the year. These softer conditions as well as a strong quarter in the prior year period, made for a tough comparison versus the prior year across most metrics. We reported net sales of $232 million in the quarter and adjusted EBITDA of $12.7 million. We remain focused on driving further operational efficiency improvements, strengthening our Vehicle Solutions segment and growing our Electrical Systems segment to be our largest business. We fully executed restructuring initiatives in the first quarter. It, combined with additional efforts I'll discuss later underpin our financial guidance for 2024. Despite a net use of cash in the quarter, our net leverage ratio remained strong at 1.8 times. We also continued driving new business wins, recording approximately $45 million in new wins so far this year on a fully ramped basis.

我想請您注意從幻燈片 3 開始的補充收益演示。這些疲軟的情況以及去年同期的強勁季度，使得大多數指標與去年的比較變得艱難。我們報告本季淨銷售額為 2.32 億美元，調整後 EBITDA 為 1,270 萬美元。我們仍然專注於進一步提高營運效率，加強我們的車輛解決方案部門，並將我們的電氣系統部門發展成為我們最大的業務。一季我們全面落實重組措施。它與我稍後討論的其他努力相結合，支撐了我們 2024 年的財務指引 儘管本季度淨使用現金，但我們的淨槓桿率仍保持在 1.8 倍的強勁水平。我們也持續推動新業務的成長，今年迄今，在全面提升的基礎上，新業務成長了約 4,500 萬美元。

Consistent with our strategy.

與我們的策略一致。

These wins continue to be focused within our Electrical Systems segment and support the product ramp up at our two new plants and additional Morocco facility, which are focused on meeting the demand growth in electrical systems Turning to slide 4, I'd like to take this opportunity to highlight some recent strategic actions we've taken, which all serve, as a reminder of our continued goal to align costs and improve margins at CVG. First, we continue to make significant strides in our organizational efficiency improvements as our restructuring actions to reduce costs and align resources with our growth. Product lines remain underway in line with that, we announced last quarter the consolidation of products manufactured in our facility in Chillicothe, Ohio. We now have a signed purchase agreement for the sale of the chilled coffee facility with the transaction expected to close in Q3. Second, our operational excellence emphasis supports our ongoing cost-out program, which focuses on productivity, materials and conversion costs. Finally, we are persistent in our efforts to increase engagement by prioritizing customer satisfaction across the organization. Our collaboration across business segments will help introduce new products, foster stronger customer relationships and help us manage inflationary price recoveries. Collectively, these efforts are targeted to improve profitability, increase enterprise-wide efficiency and support our outlook for the full year 2024.

這些勝利繼續集中在我們的電氣系統部門，並支持我們的兩個新工廠和額外的摩洛哥工廠的產品提升，這些工廠專注於滿足電氣系統的需求增長轉向幻燈片 4，我想以此有機會強調我們最近採取的一些策略行動，這些行動都有助於提醒我們調整成本和提高CVG 利潤率的持續目標。首先，我們透過重組行動降低成本並使資源與我們的成長保持一致，在提高組織效率方面繼續取得重大進展。產品線仍在進行中，我們上季宣布整合我們位於俄亥俄州奇利科西工廠生產的產品。我們現已簽署了出售冷凍咖啡設施的購買協議，預計交易將於第三季完成。其次，我們對卓越營運的重視支持我們正在進行的成本削減計劃，該計劃專注於生產力、材料和轉換成本。最後，我們堅持不懈地努力透過優先考慮整個組織的客戶滿意度來提高參與度。我們跨業務部門的合作將有助於推出新產品，培養更牢固的客戶關係，並幫助我們管理通貨膨脹的價格復甦。總的來說，這些努力的目標是提高盈利能力、提高整個企業的效率並支持我們對 2024 年全年的展望。

Now moving to Slide 5. I'd like to highlight the expansion of our new Unity seat product line within our Vehicle Solutions segment. Unity seat line has many product features that are helping us win business globally, including powered full seat tilt and lever recliners, decreased free play and performance above market requirements. Importantly, Unity line has achieved safety compliance across all our strategic regions and market segments. This expansion is a strong example of how we are strengthening our core vehicle solutions business through customer focus, solutions and technology. We look forward to growing our Unity sales globally and sharing our successes with you in future quarters.

現在轉到投影片 5。 Unity 座椅系列擁有許多產品功能，可幫助我們贏得全球業務，包括電動全座椅傾斜和槓桿躺椅、減少自由活動以及高於市場要求的性能。重要的是，Unity 系列已在我們所有戰略區域和細分市場中實現了安全合規。此次擴張是我們如何透過以客戶為中心、解決方案和技術來加強我們的核心汽車解決方案業務的有力例證。我們期待在未來幾季增加 Unity 的全球銷售並與您分享我們的成功。

With that, I'd like to turn the call back to Andy for a more detailed review of our financial results.

說到這裡，我想把電話轉回給安迪，讓他更詳細地審查我們的財務表現。

Thank you, James, and good morning, everyone. If you are following along in the presentation, please turn to Slide 6. Consolidated first quarter 2024 revenues was $232 million as compared to $263 million in the prior year period. The decrease in revenues is due primarily to a softening in customer demand globally. The anticipated wind-down of certain programs in our Vehicle Solutions segment and a decline in our Aftermarket & Industrial Automation segments, which more than offset an increase in Electrical Systems revenues.

謝謝你，詹姆斯，大家早安。如果您正在閱讀演示文稿，請參閱幻燈片 6。2024 年第一季合併收入為 2.32 億美元，而去年同期為 2.63 億美元。收入下降的主要原因是全球客戶需求疲軟。我們的車輛解決方案部門的某些項目預計將逐步結束，以及售後市場和工業自動化部門的下降，足以抵消電氣系統收入的成長。

Adjusted EBITDA was $12.7 million for the first quarter compared to $19.8 million in the prior year. Adjusted EBITDA margins were 5.5%, down 200 basis points as compared to adjusted EBITDA margins of 7.5% in the first quarter of 2023, driven primarily by lower volumes and inflationary impacts, partially offset by lower SG&A expenses.

第一季調整後 EBITDA 為 1,270 萬美元，去年同期為 1,980 萬美元。調整後 EBITDA 利潤率為 5.5%，較 2023 年第一季調整後 EBITDA 利潤率 7.5% 下降 200 個基點，這主要是由於銷售下降和通膨影響，但 SG&A 費用下降部分抵消了這一影響。

Interest expense was $2.3 million as compared to $2.9 million in the first quarter of 2023. The decrease in interest expense was primarily related to lower average debt balances during the respective periods.

利息支出為 230 萬美元，而 2023 年第一季為 290 萬美元。

Net income for the quarter was $2.9 million, or $0.09 per diluted share as compared to a net income of $8.7 million or $0.26 per diluted share in the prior year. Adjusted net income for the quarter was $4.4 million, or $0.13 per diluted share as compared to $9.2 million. It was $0.28 per diluted share in the prior year.

本季淨利為 290 萬美元，即稀釋後每股收益 0.09 美元，而前一年淨利為 870 萬美元，即稀釋後每股收益 0.26 美元。本季調整後淨利為 440 萬美元，即稀釋後每股收益 0.13 美元，去年同期為 920 萬美元。上一年攤薄後每股價格為 0.28 美元。

Moving to the segment result, beginning Slide 7, our Electrical Systems segment achieved revenues of $55.8 million, an increase of 1.9% as compared to the year ago quarter, with the increase resulting primarily from increased pricing sales volume with legacy customers saw a slight decline as a result of softening construction and agriculture end markets. Recent comments from ODMs in these end markets have indicated weakening demand, and we will continue to proactively adjust our cost structure Should these trends continue. We have also seen customer delays in the ramp of new business wins, resulting in total sales volume being largely flat year over year. Adjusted operating income was $3.1 million, a decrease of $2 million compared to the first quarter of 2020 sorry, operating income was negatively impacted at our Mexico facilities by the strengthening of the peso and the government mandated wage increases that took effect on January first. We are continuing to work with our customers to offset these headwinds However, negotiations remain ongoing. Construction on our second Morocco facility remains on track and is expected to be complete by the fourth quarter of 2024. We will remain focused on driving operational improvements and optimizing margins even additional new wins Flowfill.

轉向部門業績，從幻燈片 7 開始，我們的電氣系統部門實現收入 5580 萬美元，與去年同期相比增長 1.9%，增長主要是由於老客戶的定價銷售量略有下降由於建築和農業終端市場疲軟。這些終端市場的原始設計製造商最近的評論表明需求疲軟，如果這些趨勢持續下去，我們將繼續主動調整我們的成本結構。我們還發現客戶延遲了新業務的成長，導致總銷量比去年同期基本持平。調整後營業收入為 310 萬美元，比 2020 年第一季減少 200 萬美元。 抱歉，由於比索升值以及 1 月 1 日生效的政府強制工資上漲，我們墨西哥工廠的營業收入受到了負面影響。我們將繼續與客戶合作，以抵消這些不利因素，但談判仍在進行中。我們第二個摩洛哥工廠的建設仍在按計劃進行，預計將於 2024 年第四季完工。

Turning to slide 8, our Vehicle Solutions segment first quarter revenues decreased 14% to $137.9 million compared to the year-ago quarter, due primarily to lower customer demand, including the impact of supply shortages at a key customer that negatively impacted our schedules. Additionally, the anticipated wind-down of certain unfavorable programs in the segment weighed on revenues in the quarter. Adjusted operating income for the first quarter was $10.9 million, a decrease of $2.6 million compared to the prior year period as lower market demand was partially offset by operational improvements and lower SG&A. We remain focused on strengthening our core business in vehicle solutions and this segment remains a key focus for our team in terms of reducing costs, driving further operational improvements as well as winning business on new platforms or is the goal of driving improved margin.

轉向幻燈片8，我們的車輛解決方案部門第一季收入與去年同期相比下降14%，至1.379 億美元，這主要是由於客戶需求下降，包括關鍵客戶供應短缺對我們的日程安排產生了負面影響。此外，該領域某些不利項目的預期結束也對該季度的收入造成壓力。第一季調整後營業收入為 1,090 萬美元，比上年同期減少 260 萬美元，因為市場需求的下降被營運改善和銷售管理及管理費用 (SG&A) 的下降部分抵消。我們仍然專注於加強我們在車輛解決方案方面的核心業務，該細分市場仍然是我們團隊在降低成本、推動進一步營運改進以及在新平台上贏得業務或提高利潤率方面的重點關注點。

Moving to slide 9, our aftermarket and Accessories segment revenues in the first quarter decreased 9.5% to $34.1 million compared to the year ago quarter, primarily resulting from decreased sales volume on lower customer demand and the drawdown of backlog in the prior year period.

轉向幻燈片 9，我們的售後市場和配件部門第一季的收入與去年同期相比下降了 9.5%，至 3,410 萬美元，這主要是由於客戶需求下降導致銷量下降以及去年同期積壓訂單的減少。

Adjusted operating income for the first quarter was $4.6 million, a decrease of $1 million compared to the prior year period. The decrease is primarily attributable to lower sales volumes on a sequential basis. Results in this segment increase in terms of revenue and adjusted operating income as our operational improvement initiatives bear fruit.

第一季調整後營業收入為 460 萬美元，比去年同期減少 100 萬美元。下降的主要原因是銷量季減。隨著我們的營運改善措施取得成果，該部門的收入和調整後營運收入有所增加。

Turning to Slide 10. Our Industrial Automation segment produced first quarter revenues of $4.3 million, a decrease of 56% as compared to $9.7 million in the first quarter of 2023 due to ongoing challenging market conditions and reduced demand from legacy customers.

轉向投影片 10。

Adjusted operating income was a loss of $1.9 million compared to a loss of $0.2 million in the prior year period. As we continue to take actions to rightsize this business. We are focused on strengthening our both commercial excellence and operational execution to improve order intake. In parallel with these activities, we are actively exploring new end markets and developing new highly engineered products. An example of this is the development of a new product named spec, which was showcased at the Modec tradeshow in March with This concludes my financial overview. I will now turn the call back over to James to discuss our updated 2024 outlook.

調整後營業收入虧損 190 萬美元，而上年同期虧損 20 萬美元。隨著我們繼續採取行動調整該業務規模。我們專注於加強我們的商業卓越性和營運執行力，以提高訂單量。在進行這些活動的同時，我們也積極探索新的終端市場並開發新的高度工程化的產品。這方面的一個例子是名為spec的新產品的開發，該產品在三月的Modec貿易展上進行了展示，這就是我的財務概述。我現在將把電話轉回給 James，討論我們最新的 2024 年展望。

Thank you, Andy.

謝謝你，安迪。

Turning to slide 11, I'll share several thoughts on our outlook for 2024 following the introduction of our quantitative annual guidance at the revenue and adjusted EBITDA level in March 2024, we are reaffirming our previously announced guidance ranges for both metrics. Industry forecast currently projected decline in North American Class A. truck builds of approximately 10% for the year, a slightly positive revision from the previous estimate of a 16% decline. This favorable revised Class eight outlook is being offset by weakening in the construction and agriculture end markets, which we expect to be flat to down 10% in 2024. Notwithstanding these market changes, we are reaffirming our guidance range of $915 million to $1.015 billion in full year 2024 revenues, we believe our business will continue to be resilient as we benefit from the diversification strategy and forward-looking resource allocation. Given the aforementioned truck build estimates, construction and ag market outlooks and the expectation for further Electrical Systems segment growth. We expect adjusted EBITDA to be solidly in the previously provided guidance range of $60 million to $73 million for 2024. We believe that the actions being taken to consolidate operations, rescale our labor force, together with continued discussions with our customers to manage headwinds will serve to underpin the guidance. We continue to expect that we will generate positive free cash flow, providing us with optionality to pursue either debt paydown or inorganic growth efforts should we find an attractive opportunity. We continue to see multiple opportunities to improve profitability through operational cost efficiency and making strategic sourcing decisions and expect all of this to lead to improved working capital management and increased cash generation. Collectively, our business transformation is expected to drive a stronger business mix and make CVG a stronger and more profitable company in the coming years. With that, I will now turn the call back over to the operator to open the line up for questions.

轉向幻燈片 11，在 2024 年 3 月推出收入和調整後 EBITDA 水平的定量年度指導之後，我將分享對 2024 年前景的一些想法，我們重申之前宣布的這兩個指標的指導範圍。目前產業預測預計今年北美 A 級卡車產量將下降約 10%，較先前下降 16% 的預測略有積極修正。這種有利的修訂後的8 類前景被建築和農業終端市場的疲軟所抵消，我們預計2024 年該市場將持平至下降10%。億美元的指導範圍。鑑於上述卡車製造估計、建築和農業市場前景以及電氣系統細分市場進一步增長的預期。我們預期調整後的EBITDA 將穩定在先前提供的2024 年6,000 萬美元至7,300 萬美元的指導範圍內。因素將起到作用以鞏固指導。我們仍然預期我們將產生正的自由現金流，如果我們找到有吸引力的機會，我們將可以選擇追求債務償還或無機成長努力。我們繼續看到透過營運成本效率和製定策略採購決策來提高獲利能力的多種機會，並期望所有這些都將改善營運資本管理並增加現金產生。總的來說，我們的業務轉型預計將推動更強大的業務組合，並使 CVG 在未來幾年成為更強大、更有利可圖的公司。這樣，我現在將把電話轉回給接線員以打開提問隊列。

Operator?

操作員？

Thank you.

謝謝。

Ladies and gentlemen. We will now begin the question and answer session. Should you have a question, please press star followed by the one on your touchtone phone. You will hear a prompt that your hand has been right. Should you wish to decline from the polling process, please press star followed by the number two are using a speakerphone. Please lift the handset before press.

女士們，先生們。我們現在開始問答環節。如果您有疑問，請按星號，然後按按鍵式電話上的號碼。您將聽到提示，表明您的手牌正確。如果您希望拒絕投票過程，請按星號，然後按數字 2 正在使用免持電話。請在按下前拿起聽筒。

Yes. Our first question comes from the line of John Franzreb from Sidoti & Company.

是的。我們的第一個問題來自 Sidoti & Company 的 John Franzreb。

Good morning, everybody, and thanks for taking the questions for Joe and John, I'd like to start with the vehicle solutions segment and the wind-down of certain programs. I'm curious how much of that impacted the revenue line year over year? And are those program wind-downs complete or they continue into the second quarter and beyond?

大家早安，感謝您向喬和約翰提出問題，我想從車輛解決方案部分和某些項目的結束開始。我很好奇這對收入線的年比影響有多大？這些計劃是否已經結束，還是會持續到第二季​​及以後？

Yes.

是的。

So John, thanks for the question. So on the majority of the wind tunnel has been completed. And so right now, we see it for the quota of, call it a single digit million euro level of impact. But you have to remember this is anticipated wind down that we talk about a few quarters ago at I'll call it maybe and during the time when we renegotiate the pricing on the last round, we decided that there are certain programs that are not favorable for us and we decided to exit them. So you can see the impact actually showing up now in Q1. So something that we've been working for quite a while ago, and it took some time for us to work through the final production and now Q1, you can see the numbers.

約翰，謝謝你的提問。這樣風洞就大部分已經完成了。所以現在，我們看到它的配額，稱之為百萬歐元等級的影響。但你必須記住，這是我們在幾個季度前談論的預期結束，我會稱之為“也許”，在我們重新協商上一輪定價的期間，我們認為某些計劃並不有利對於我們來說，我們決定退出他們。因此，您可以看到第一季實際出現的影響。所以我們很久以前就一直在做這件事，我們花了一些時間來完成最終的製作，現在是第一季度，你可以看到這些數字。

Got it.

知道了。

Got it.

知道了。

And is it safe to say that all the repricing actions and everything related to that is down the pun intended rear-view mirror?

可以肯定地說，所有重新定價行動以及與之相關的一切都在雙關語意的後視鏡中嗎？

Yes, yes, you're right.

是的，是的，你說得對。

Okay.

好的。

Regarding the restructuring actions, can you kind of quantify the Yum, how much in restructuring actions that you're going to you're going to take maybe collectively have an idea for calendar '24 and what you're anticipated annualized savings rate will be from these actions?

關於重組行動，您能否量化百勝集團，您將採取多少重組行動，也許集體對日曆'24有一個想法，以及您預期的年化儲蓄率是多少從這些行動中？

Yes. So a couple of things we announced last quarter that we were doing a few restructuring mainly here in North America during the quarter. In Q1, we executed about $2 million of restructuring costs of call it, maybe two thirds of it related to headcount reductions and then one-third of it related to facility closings. We recorded more than halfway through our restructuring program. We will still have some activity going on in Q2, and most of these should be wrapped up by Q3. So are both in terms of our facility manufacturing as well as SG&A.

是的。因此，我們上季度宣布了幾件事，即本季度我們主要在北美進行了一些重組。在第一季度，我們執行了約 200 萬美元的重組成本，其中三分之二可能與裁員有關，三分之一與關閉設施有關。我們的重組計劃已完成一半以上。我們在第二季仍將進行一些活動，其中大部分應該會在第三季結束。我們的設施製造以及銷售、管理和行政管理 (SG&A) 方面也是如此。

So that's where we are right now.

這就是我們現在的處境。

And you anticipated net savings annualize when you've done this process?

當您完成此過程後，您預計每年節省多少淨額？

Yes.

是的。

So it depends really on the different type of the projects are we obviously have a mixed bag of multiple kind of project SG&A and manufacturing. Normally, we target about two years of payback in our saving projects, but it will be depends on the type of the actions within the restructuring program.

因此，這實際上取決於項目的不同類型，我們顯然有多種項目的銷售、行政管理和製造的混合。通常，我們的儲蓄項目的投資回收期約為兩年，但這取決於重組計劃中行動的類型。

And I guess last and I'll get back into queue on the industrial automation business took it took us will step down as far as revenue compared to the second half of last year, I was under I guess the anticipation was kind of troughing at that high 30 low 40 revenue level on and actually was also under the impression that maybe that business had the potential to get better in the year ahead has something fundamentally changed? Can you kind of talk about what's going on there?

我想最後，我將回到工業自動化業務的隊列中，與去年下半年相比，我們的收入將下降，我想我的預期有點低谷高30 低40 收入水平，實際上也有這樣的印象：也許該業務有潛力在未來一年變得更好，是否發生了根本性的變化？你能談談那裡發生了什麼事嗎？

Hey, John, this is James. Yes, we're in the middle of the transformation of that business, as we talked about on the last call, were shifting from more of a contract manufacturing piece of base business, more engineered products, serialized production business with longer term contracts. So part of this was anticipated. However, the PO business is very cyclical and it's very lumpy as it comes in. So several of our customers are in the government space. And when they have year end spend toward the end of the third quarter, typically for government, that's when we tend to see a pickup. So that's been lighter than it was in prior year. And as we invest in SG&A to go to the engineered products, like we have mentioned, the stack product, we added engineers and SG&A to participate in the Motor Show, but also a test for the stack product, but also other new products with other new customers that are much more technical and engineering heavy. So we're in the midst of this transformation, and we have seen a recent improvement in our order inbound as well as contracts will be shipping product in Q3 and Q4. So the leading indicators are giving us some level of confidence that we'll be continuing to turn this around going on the upside.

嘿，約翰，這是詹姆斯。是的，我們正處於該業務的轉型過程中，正如我們在上次電話會議中談到的那樣，我們正在從更多的合約製造基礎業務、更多的工程產品、具有長期合約的系列化生產業務轉變。所以這一部分是預料之中的。然而，採購訂單業務具有很強的周期性，而且進來時非常不穩定。當他們在第三季末有年終支出時（通常是政府支出），我們往往會看到支出增加。所以比去年還要輕。當我們投資 SG&A 到工程產品時，就像我們提到的堆疊產品一樣，我們增加了工程師和 SG&A 參加車展，也是對堆疊產品的測試，而且還有其他新產品與其他新客戶的技術和工程要求更高。因此，我們正處於這一轉型之中，我們看到最近的訂單入境情況有所改善，並且合約將在第三季和第四季運送產品。因此，領先指標給了我們一定程度的信心，讓我們相信我們將繼續扭轉局面，走向上行。

Okay.

好的。

So James, it's fair to say you think this is a revenue trough in our end as well as in that transition period.

所以詹姆斯，可以公平地說，你認為這是我們最終以及過渡時期的收入低谷。

Yes. So yes, to a certain degree, yes, but it can depend on the others, sharp rebound or whether in unless we get near term contracts on these new products, we could see more of a spike back up or maybe a longer recovery depending on the new products. These new products require prototypes and alpha and beta testing of prototypes and customer facilities and also in their customer facilities as well.

是的。所以，是的，在某種程度上，是的，但這可能取決於其他因素，急劇反彈，或者除非我們獲得這些新產品的短期合同，否則我們可能會看到更多的飆升，或者可能會出現更長的復甦，取決於新產品。這些新產品需要原型以及原型和客戶設施及其客戶設施的 ​​alpha 和 beta 測試。

When you're into a full fulfillment center ecosystem there's a double level of beta and alpha testing. So the time line for the new products from a revenue standpoint, the prototype revenue as well as in R&D is in the three to six months range of and full-scale production. We foresee that being in the six to nine month range on these new products, which in many cases have a higher skew price than some of our existing contract manufacturing products.

當您進入完整的履行中心生態系統時，就會有雙重等級的 beta 和 alpha 測試。因此，從收入的角度來看，新產品的時間軸、原型收入以及研發都在三到六個月的範圍內並全面生產。我們預計這些新產品的價格將在六到九個月的範圍內，在許多情況下，其價格偏差比我們現有的一些合約製造產品更高。

Got it. Thank you.

知道了。謝謝。

So I'll get back into queue.

所以我會回到隊列中。

Thank you.

謝謝。

Our next question comes from the line of Gary Prestopino from Barrington Research.

我們的下一個問題來自 Barrington Research 的 Gary Prestopino。

Hi, good morning, James, and it's my questions also revolve around what you're doing on the restructuring side.

嗨，早安，詹姆斯，我的問題也圍繞著你在重組方面所做的事情。

I guess given the fluid nature of what the changes you're seeing in some of your markets on in particular, I think you said some of the electrical systems areas are starting to see some weakness in construction and ag. I presume you've identified most of what you wanted to do in 2024 in terms of restructuring? Or is this kind of more or less a fluid process that's really going to be ongoing.

我想考慮到您在某些市場上看到的變化的流動性，特別是，我認為您說過一些電力系統領域開始在建築和農業方面出現一些弱點。我想您已經確定了 2024 年在重組方面想做的大部分事情吧？或者說，這種或多或少是一個真正持續不斷的流動過程。

Know it's really going to this is James and Hi, thank you for the question. It's really going to depend on how this market recovery track. So in this construction ag segment of the market. Our business is primarily with legacy long-term customers. They're not like new startups. So we do need to be prepared for a recovery in the market. So we will continue to adjust both up and down depending on the signals we get from that customer segment and those market segments in the fall last year, indications from our outlooks from those customers led to a low single digit year over year improvement in what they had communicated, but they've since communicated a flat to down 10% outlook for the year. So we had plans in place to comprehend a low single digit increase the market. And now we're in the pivot mode to scale things back for a flat to down 10%. So it was a pretty significant swing. A number of macro items influence that in different regions, both Europe and North America. But that is what we're doing. The flex to trying to maintain as much margin, but also make sure we have the appropriate amount of capacity in place when they do come back up. We're not have short of capacity and not able to fulfill the contracts we sign up for and lose market share. So it's quite a quite a delicate balance to do that. But our outlook remains very positive in these markets as they are somewhat cyclical in nature.

我知道這真的會發生，我是詹姆斯，嗨，謝謝你的提問。這其實取決於市場復甦的軌跡。因此，在建築農業市場領域。我們的業務主要是針對傳統的長期客戶。他們不像新的新創公司。因此，我們確實需要為市場復甦做好準備。因此，我們將根據去年秋季從該客戶群和這些細分市場獲得的信號，繼續上下調整，這些客戶的前景表明，他們的業績同比出現了低個位數的改善。此後他們對今年的展望持平至下降10%。因此，我們制定了計劃來應對低個位數成長的市場。現在我們正處於樞軸模式，將規模縮減至持平至下降 10%。所以這是一個相當重大的轉變。許多宏觀因素都會影響歐洲和北美等不同地區的情況。但這就是我們正在做的事情。努力保持盡可能多的利潤，但也要確保當它們恢復時我們有適當的容量。我們並不是產能不足，無法履行我們簽訂的合約並失去市場份額。因此，做到這一點是一個非常微妙的平衡。但我們對這些市場的前景仍然非常樂觀，因為它們本質上具有週期性。

Okay. And then internally, your guidance of $60 million to $73 million for EBITDA would have been more or less the electrical segment that would have to do an unexpected downturn for you to be as well below that $60 million.

好的。然後在內部，您對 EBITDA 的指導為 6000 萬至 7300 萬美元，或多或少是電力部門，如果出現意外的低迷，您的 EBITDA 將遠低於 6000 萬美元。

It could be a number of items. It could be a deterioration back in Class A. So if you recall, the class being forecast by ACT has been somewhat volatile over the last six months of down that. I know that was backed up a little because the larger portion of our revenue stream is in the vehicle solutions segment type of Class A. trucks. We saw a reversal of this positive trend back down to the minus 16 or four more percent down. That could influence where we end up in the range on the Electrical segment because we have more programs that are launching and some of those launches have been delayed, which is some of the headwinds we see, but they will be coming and a recent rebound in the construction ag market. I would say that we still are confident that we'll be in that range unless something very significant happens.

它可能是多個項目。 A 類的情況可能會惡化。我知道這一點得到了一些支持，因為我們收入流的很大一部分來自 A 級卡車的車輛解決方案細分市場。我們看到這一正向趨勢逆轉回負 16 個百分點，即下降了 4 個百分點。這可能會影響我們在電氣領域的最終排名，因為我們有更多的項目正在啟動，其中一些項目已被推遲，這是我們看到的一些逆風，但它們將會到來，並且最近的反彈建築農業市場。我想說的是，除非發生非常重大的事情，否則我們仍然有信心處於這個範圍內。

And Gary, if I may add to it, one thing that we see some uncertainties and volatility is really still the supply chain disruption that pop up here. And there you probably remember last quarter there was some labor disruption at our customers and those labor issues are still happening from places to places at different customers. We saw this quarter. Also, some of our suppliers of our customers also have supply issue impacting our customers. And of course, we all know that the Suez Canal issue affecting logistics. So those are the things probably healthy, potentially a downside risk if something continue to happen throughout the year.

蓋瑞，如果我可以補充一點的話，我們看到一些不確定性和波動性的一件事實際上仍然是這裡出現的供應鏈中斷。您可能還記得上個季度我們的客戶出現了一些勞動力中斷，而這些勞動力問題仍然在不同的客戶處發生。我們看到了這個季度。此外，我們客戶的一些供應商也存在影響我們客戶的供應問題。當然，我們都知道蘇伊士運河問題影響物流。因此，這些事情可能是健康的，但如果全年繼續發生某些事情，則可能存在下行風險。

So up the last couple of quarters, we've seen some of them happening.

因此，在過去的幾個季度中，我們看到了其中一些情況的發生。

Thank you.

謝謝。

In case, ladies and gentlemen, just a short reminder, if you have a question, please press star followed by the number one on your touchtone phone. And our next question coming from the line of Joe Gomes from NOBLE Capital Markets.

以防萬一，女士們先生們，請簡短提醒一下，如果您有疑問，請按按鍵式電話上的星號，然後按數字 1。我們的下一個問題來自 NOBLE Capital Markets 的 Joe Gomes。

Please go ahead, sir.

請繼續，先生。

Good morning.

早安.

This is Josh Wilson filling in for Joe or drove more and so the second question is on the electrical side of business. You know it kind of, but to have this kind of a bit slower revenue growth than kind of we expected just given kind of recent contract wins, there was really something behind that lower growth rates?

這是喬什威爾遜 (Josh Wilson) 接替喬的工作，或者開車更多，所以第二個問題是關於業務的電氣方面。你知道這一點，但是考慮到最近贏得的合同，收入增長速度比我們預期的要慢一些，那麼較低的增長率背後真的有什麼原因嗎？

Yes, it does. And so on, as James already mentioned, so the legacy customer is mostly construction and agriculture. So as we explained, that does make up the majority of the end markets of the electrical segments so that we have seen a slight decline. So at the same time. If you look back in the last couple of quarters on the growth of the segments, it come from, continue ramping our new wins over the years as we described this year, we saw a slowdown of those ramp. So mostly because of customers seeing logistical and supply chain challenges. So they were not able to ramp up their production. So in turn, obviously, we don't get the revenues to supply to them so that the combination that impacting this quarter, our overall the volume is still up. So meaning that we still seeing some level of new revenues, but not as fast as we would like, but hopefully that our customer can overcome their challenges and continue to win new businesses.

是的，它確實。等等，正如詹姆斯已經提到的，遺留客戶主要是建築和農業。正如我們所解釋的，這確實構成了電氣領域終端市場的大部分，因此我們看到了略有下降。所以同時。如果你回顧過去幾季的細分市場的成長，你會發現，正如我們今年所描述的那樣，多年來我們繼續取得新的勝利，我們發現這些成長有所放緩。主要是因為客戶面臨物流和供應鏈挑戰。因此他們無法提高產量。因此，顯然，我們沒有獲得向他們提供的收入，因此影響本季的組合，我們的整體銷售仍在上升。因此，這意味著我們仍然會看到一定程度的新收入，但速度沒有我們希望的那麼快，但希望我們的客戶能夠克服挑戰並繼續贏得新業務。

Yes, Josh, I'll just add to that point, we are not seeing any lost business from new wins we've pulled. So that gives us a leading indicator that the market will come back at some point, we don't have any leakage of fast business. So we still feel confident that we're going to have longer-term tailwind from all these new business wins in addition to construction and ag. It's also infrastructure customers as well as EV and electrification applications within legacy and new OEM start-ups. So it's a very diverse set of segments we serve in two, but to Andy's point, the largest two segments in the electrical business or contact both in North America and Europe.

是的，喬什，我只想補充一點，我們沒有看到我們取得的新勝利造成任何業務損失。因此，這為我們提供了一個領先指標，表明市場將在某個時候回歸，我們沒有任何快速業務的洩漏。因此，我們仍然有信心，除了建築和農業之外，我們還將從所有這些新業務的勝利中獲得長期的推動力。它還包括基礎設施客戶以及傳統和新 OEM 新創公司中的電動車和電氣化應用。因此，我們服務於兩個非常多樣化的細分市場，但就安迪的觀點而言，這是北美和歐洲電氣業務或聯繫中最大的兩個細分市場。

Okay.

好的。

That's helpful. And then just as for the silicon ag markets, is there really a big driving big driver in that deterioration of those industries that you guys have noticed.

這很有幫助。然後，就像矽農業市場一樣，你們已經注意到這些產業的惡化是否真的存在著一個巨大的推動因素。

And there are a few things that we heard from our ODM customers. One as you know, China is in a bad spot right now. So the Asia Pacific activity is pretty pretty low at this point.

我們從 ODM 客戶那裡聽到了一些事情。眾所周知，中國現在的處境很糟。因此，目前亞太地區的活動相當低。

Our Europe Europe, we also see some reduction in demand overall again, if the economy over there. And then I think the most recent development here in North America, so compared to a few months ago, the market has low at our customers also publicly mentioned that in their earnings calls that they are seeing some videos activities. So it's mostly demand driven based on what we heard from our customers.

我們的歐洲歐洲，如果那裡的經濟狀況好的話，我們也看到整體需求再次減少。然後我認為北美最近的發展，與幾個月前相比，市場處於低位，我們的客戶也公開提到，在他們的財報電話會議中，他們看到了一些視訊活動。因此，這主要是根據我們從客戶那裡聽到的需求所驅動的。

Okay, perfect. And then last one for me. I'll get back in queue. I guess with the first quarter over the new business wins of $45 million in line with your goals for the quarter kind of are we still expecting $100 million eventually?

好的，完美。然後是我的最後一張。我會回到隊列中。我想第一季新業務收入超過 4500 萬美元，與您本季的目標一致，我們是否仍期望最終獲得 1 億美元？

Yes. For the year, we're still expecting $100 billion of the $45 million is tracking well, when you look at our pending awards that we've quoted as well as our funnel of opportunities that we're pursuing, not just within Electrical, but also in our vehicle solutions group and aftermarket and accessories and also in industrial automation, we have a good funnel in each one of those businesses. We just need to bring home the awards that are pending.

是的。今年，我們仍然預計 4500 萬美元中的 1000 億美元進展順利，當你看看我們引用的待決獎項以及我們正在尋求的機會管道時，不僅在電氣領域，而且在同樣在我們的車輛解決方案集團、售後市場和配件以及工業自動化領域，我們在每項業務中都有良好的管道。我們只需要將懸而未決的獎項帶回家。

And then on the pursuit opportunities. We have ample capacity in our outlook to be aggressive on winning those opportunities in the pursuit funnel to. So we feel confident at this point that we will achieve that $100 million on an annualized basis that we have I mentioned before in prior calls.

然後是追求機會。我們有足夠的能力積極爭取在追求漏斗中贏得這些機會。因此，我們現在有信心實現年化 1 億美元的目標，正如我之前在電話會議中提到的那樣。

Thank you.

謝謝。

Our next question comes from the line of Steven Martin from Slater go ahead.

我們的下一個問題來自斯萊特的史蒂文·馬丁（Steven Martin），繼續。

Hi, guys.

嗨，大家好。

Good morning, Steven.

早安，史蒂文。

Good morning, Steven.

早安，史蒂文。

On same basis, you said the second Moroccan plant will be completed and by the end of the first quarter that was 40 days ago. So I guess my question is, was it completed and is it producing?

同樣，您說第二個摩洛哥工廠將在第一季末（即 40 天前）竣工。所以我想我的問題是，它已經完成並且正在生產嗎？

So we have an initial on Morocco facility that we're currently producing and that was completed in Q4. The second facility was started in Q1 this year. That will be complete by the end of Q4 this year with beneficial occupancy coupon of '25.

因此，我們目前正在摩洛哥建立一個初步工廠，該工廠已於第四季完工。第二個設施於今年第一季啟動。該項目將於今年第四季末完成，優惠入住券為 '25。

Got it.

知道了。

And I misheard that. And how is the the new Moroccan plant and the new Mexican plant doing.

我聽錯了。新的摩洛哥工廠和新的墨西哥工廠的情況如何？

Other both they're both ramping up very well.

其他方面，他們都進展得很好。

We are able to actually improve our funnel of opportunities with the North Africa and Morocco footprint for the European market. So we're seeing a good customer response from our expansion of our European footprint. As you may know, we have facilities in the Ukraine as well as Czech Republic for the Electrical Systems business. So this expansion into North Africa is positioning us well from a value proposition on new opportunities in Europe.

透過北非和摩洛哥的歐洲市場足跡，我們實際上能夠改善我們的機會管道。因此，我們看到客戶對我們歐洲業務擴張的良好反應。如您所知，我們在烏克蘭和捷克共和國設有電氣系統業務設施。因此，這次向北非的擴張使我們在歐洲新機會的價值主張上處於有利地位。

In Mexico, the Alabama facility, which is outside of Chihuahua, is ramping up very well. Our main facility in Mexico was in pockets in Agua Prieta. So the team that's managing those facilities is based in Chihuahua and Auger Fiat, and we're somewhat running those two in parallel. And we have a ramp schedule that will continue to ramp throughout the year and early next year with some of the North American new business wins that we've booked over the past 12, 18 months.

在墨西哥，位於奇瓦瓦州郊外的阿拉巴馬州工廠正在蓬勃發展。我們在墨西哥的主要工廠位於阿瓜普列塔 (Agua Prieta)。因此，管理這些設施的團隊位於奇瓦瓦州和奧格菲亞特，我們在某種程度上並行運作這兩個設施。我們有一個成長計劃，該計劃將在全年和明年初繼續成長，其中包括我們在過去 12、18 個月中預訂的一些北美新業務。

Okay.

好的。

On And to follow up, someone's earlier question about your guidance, if I were to choose the midpoint of this year's guidance and on given how you've done in the first quarter, that would imply that the first the I'm sorry, the back half would have to be 10% to 12% to make the mid maybe 10% to 15% to make the midpoint of your guidance. What gives you that level of comfort, what businesses all four businesses were down this first quarter. What what businesses are going to swing enough to make that midpoint?

跟進，有人之前就您的指導提出了問題，如果我選擇今年指導的中點，並且考慮到您在第一季度的表現，這意味著第一個我很抱歉，後半部分必須是10%到12%，中間可能是10% 到15%，才能成為指導的中點。是什麼讓你感到如此舒適，是什麼業務讓這四家公司在第一季都出現了下滑。哪些企業的波動足以達到這個中點？

Yes.

是的。

So on, Steve, if you look at our guidance, you clearly see there's a little bit of a wider range that we communicated, as James already mentioned. So that of the upside of potentially at the ACT. truck build and depends on how the contract market goals or maybe the decline is not as severe. So there's some upside opportunity. But at the same time, that of also the downside risk that we mentioned about supply chain and logistics and the continued depressed and the demand on the customer side. So I think right now it's hard to say where the final we are going to land. But we believe that our range is pretty well cover in case of those scenarios, but we probably have more confidence in our ability to manage our earnings. So as we mentioned that we've been taking proactive actions or rightsizing the business, anticipating the customer demand changes. So there's a few more levers for us to pull.

所以，史蒂夫，如果你看看我們的指導，你會清楚地看到我們溝通的範圍更廣，正如詹姆斯已經提到的那樣。這就是 ACT 的潛在優勢。卡車的製造取決於合約市場目標如何，否則下降可能不會那麼嚴重。因此存在一些上行機會。但同時，我們提到的供應鏈和物流方面的下行風險以及客戶方面的需求持續低迷。所以我認為現在很難說決賽我們會在哪裡進行。但我們相信，我們的範圍足以應對這些情況，但我們可能對自己管理收益的能力更有信心。正如我們所提到的，我們一直在採取積極主動的行動或調整業務規模，預測客戶需求的變化。因此，我們還有更多的槓桿可以發揮。

So we are pretty confident in terms of our EBITDA guidance that the range that we produce.

因此，我們對我們生產的 EBITDA 指導非常有信心。

An additional point to Steve is the restructuring benefits will start to ramp higher in the second half after some of the efforts we took in the first. In addition to that, as we had mentioned in prior calls, our cost-out program, some of those savings items will kick in higher as volume ramps up on new projects that were implemented in Q4 and Q1 as we continue to have been in Q2. So on the cost side, we see opportunities too help mitigate some of the downside of lost top line or lower top line through the cost out process that we're doing. And of that to Andy's point, it helps us manage the earnings a little better, especially in the second half. And we're hopeful that the ACT and the Class A. market will continue to strengthen in the outlook. We're not banking on it, but we're hoping that that happens.

史蒂夫的另一點是，在我們上半年採取的一些努力之後，重組效益將在下半年開始上升。除此之外，正如我們在先前的電話會議中提到的，我們的成本支出計劃中，隨著第四季度和第一季度實施的新項目數量的增加，其中一些節省的項目將會增加，因為我們在第二季度仍然如此。因此，在成本方面，我們看到機會也有助於透過我們正在進行的成本削減流程來減輕營收損失或營收下降的一些負面影響。對安迪來說，它可以幫助我們更好地管理收益，特別是在下半年。我們希望 ACT 和 A 級市場的前景將繼續走強。我們不指望它，但我們希望這種情況發生。

And then con Conor, I do think that it's volatile right now. I'm not really sure where it's going to end up, but I don't have any indication it's going to get much worse than flat to down 2%. So we're planning for the worse and putting things in place to try and mitigate pressure on the EBITDA outlook.

然後康納，我確實認為它現在很不穩定。我不太確定它最終會走向何方，但我沒有任何跡象表明它會變得比持平至下降 2% 更糟。因此，我們正在做最壞的打算，並採取措施試圖減輕 EBITDA 前景的壓力。

Okay.

好的。

A follow-up to that on ACT expects that 2025. So we're first of all, as I said on the last call, 2023 ACT. was not as bad as everybody expected at the beginning of the year, '24 ACT. looks to be plus or minus, as you said, maybe a little better, '25 is supposed to be a new cycle. When do you expect that you're going to see or we will start to see the benefits of that new site?

ACT 的後續行動預計是 2025 年。 '24 ACT 的情況並不像年初大家預期的那麼糟。看起來是正負，正如你所說，也許好一點，'25應該是一個新的周期。您預計什麼時候您或我們將開始看到該新網站的優勢？

Yes. So that's a very good question. It's the it's interesting because, as you know, the '27 calendar year, our new federal emissions for Class eight vehicles, and I've seen ranges and estimates of potentially 30% higher insurance costs for all of the emissions. So '25, '26 outlook remains. C. team is pretty much factoring in a pre-buy. So you'll see I think you'll see a larger drop in '27 because the buyer was pulled ahead and we would expect to see a '25 model year with start the summer of or to the latter part of '24.

是的。這是一個非常好的問題。這很有趣，因為如您所知，27 日曆年，我們對 8 級車輛進行了新的聯邦排放，我已經看到了所有排放的保險成本可能增加 30% 的範圍和估計。因此，'25、'26 的前景仍然存在。 C. 團隊很大程度上考慮了預購。所以你會看到，我認為你會在 27 年看到更大的下降，因為買家提前拉動，我們預計在 24 年夏季或下半年開始看到 25 款車型。

Okay. As the new models come on and the ramp of new production, a lot of the vehicle manufacturers have a model change literally prior year of the state of your model. So that's given us some indication, I think to another question earlier, which gives us a little more confidence in the in the back half of the year even though ACT's forecast is showing a decline in Q2 for us compared to the prior quarters, we still see depends on Windows customers start there next model and how fast they ramp up. So we have to be somewhat flexible and agile so that we can respond to those ramps, both on the high side and the low side.

好的。隨著新車型的上市和新產量的增加，許多汽車製造商都會對車型狀態的前一年進行車型變更。因此，這給了我們一些指示，我認為對於之前的另一個問題，這讓我們對今年下半年更有信心，儘管ACT 的預測顯示我們第二季度的業績較前幾季有所下降，但我們仍然看到的情況取決於 Windows 客戶是否開始使用下一個模型以及他們升級的速度。因此，我們必須保持一定的靈活性和敏捷性，以便我們能夠對這些斜坡做出反應，無論是在高端還是低端。

Okay.

好的。

And ACT predicted a bad Q4 in '23 and it ended up being a lot better on this one last question. I would assume that aftermarket is sort of the yen to new value new truck Yang in the sense that if somebody doesn't replace a truck, they have to buy some more stuff in the aftermarket to keep the existing truck on the road and should we see some aftermarket benefit or is it until you get it right righted, we're just not going to see that benefit.

ACT 預測 23 年第四季的業績會很糟糕，但最後一個問題的結果卻好得多。我認為售後市場有點像新價值新卡車楊的日元，因為如果有人不更換卡車，他們就必須在售後市場購買更多東西以保持現有卡車在路上行駛，我們應該這樣做嗎？售後市場的好處，還是直到你得到正確的解決方案，我們才不會看到這種好處。

So we should see some benefit. And based on our portfolio, the majority of our aftermarket businesses in seating. So we focus we kind of took an [80-20] approach since I came into the role to figure out how we can win in aftermarket seating. And there are some pretty solid players out there that we're going up against and it comes down to two or three different things. One is how easy. It is to do business with us. And as you know, we had a website that launched it really didn't hit that well. And that's because we didn't leverage our field sales reps that I had mentioned in our last earnings call. We've done that now.

所以我們應該會看到一些好處。根據我們的產品組合，我們的售後業務大多是座椅業務。因此，自從我上任以來，我們的重點是採取 [80-20] 的方法來弄清楚我們如何贏得售後市場座位。我們要面對的對手有一些非常出色的球員，這可以歸結為兩三個不同的事情。一是多麼容易。是為了和我們做生意。如您所知，我們有一個網站推出後效果並不理想。這是因為我們沒有利用我在上次財報電話會議中提到的現場銷售代表。我們現在已經做到了。

And then the second thing is what does the customer really wanted have does that fit into our ability to carry inventory and have quick turnaround within 48, 72 hours of when they want to see. And that's what we've been working on in Q1 with our factories in a few months and seat month, Alabama, which makes our aftermarket seats. So we've put in some new processes for scheduling. We put them in different inventory Pro Farm, our we have a more regular touch point with our field sales reps. We have recently seen an increase in our inbound orders for aftermarket seating. So I think the opportunity is out there for us to take advantage of capturing share that's existing with other competitors out there. As long as we focus on offering, we do a much better job of advertising and having the right inventory to model.

第二件事是客戶真正想要的東西是否符合我們的庫存能力，並在他們想要查看的 48、72 小時內快速週轉。這就是我們在第一季與我們的工廠在幾個月內和阿拉巴馬州座椅月所做的工作，該州生產我們的售後座椅。因此，我們引入了一些新的調度流程。我們將它們放在 Pro Farm 的不同庫存中，我們與現場銷售代表有更定期的接觸點。最近，我們發現售後座位的入境訂單有所增加。因此，我認為我們有機會利用其他競爭對手的現有份額。只要我們專注於產品，我們就能在廣告和擁有合適的庫存模型方面做得更好。

The other activity we started in Q1 was a an incentive program for our field sales reps. So this is, I think, the that was the leading behavior that's driving material as a result of increased inbound orders for aftermarket sales. So hopefully, we'll continue to see positive momentum in that. But we're looking at all different angles and being contemporary in our approach from how we're driving aftermarket sales. It had been somewhat of a legacy business that was really focused on OE service for the major truck manufacturers and now we're taking a more retail type approach with our field sales reps to have a more contemporary go at it.

我們在第一季開始的另一項活動是針對我們的現場銷售代表的激勵計劃。因此，我認為，這是由於售後銷售入庫訂單增加而推動材料成長的主要行為。因此，希望我們能繼續看到這方面的正面動力。但我們正在從不同的角度審視我們推動售後市場銷售的方法，並採取與時俱進的方法。這在某種程度上是一項傳統業務，真正專注於為主要卡車製造商提供原廠設備服務，現在我們正在與我們的現場銷售代表一起採取更多零售類型的方法，以更現代的方式進行處理。

So proof's in the pudding.

所以證據就在布丁裡。

But but right now, we have some good early indicators that we should see some uplift, which is also helping us put a better pencil on the second half of the year. Overall, in the aggregate level of revenue. So we hope to see more aftermarket performance in the second half.

但現在，我們有一些良好的早期指標，我們應該會看到一些提升，這也有助於我們更好地預測下半年。整體而言，在總收入水準上。所以我們希望下半年能看到更多的售後表現。

All right.

好的。

Thank you very much.

非常感謝。

Thank you.

謝謝。

Thanks, Steve.

謝謝，史蒂夫。

We have a follow up question coming from the line of Joe Gomes from NOBLE Capital Markets. Please go ahead.

我們有來自 NOBLE Capital Markets 的 Joe Gomes 的後續問題。請繼續。

I guess just a quick follow-up from a couple of quick questions. And then you had mentioned that the additional cost actions in the press release. Can you just a little bit detail you guys are doing to offset inflation and foreign exchange headwinds? And then and how much more of the previous of cost actions need to be completed before for savings are going to realize?

我想這只是幾個簡單問題的快速跟進。然後您在新聞稿中提到了額外的成本行動。您能否詳細介紹一下你們為抵銷通貨膨脹和外匯不利因素所採取的措施？然後，為了實現節省，之前還需要完成多少成本行動？

I think it asked, so let me answer your home on a few areas.

我想它問了，所以讓我從幾個方面回答你的問題。

So one is on a lot.

所以一個人有很多。

A large part of the cost actions that we have is to make sure that we rightsize our businesses so that we can offset the impact of the softer demand of our businesses, mostly in vehicle solutions as well as electrical.

我們採取的成本行動很大一部分是為了確保調整業務規模，以便抵消業務需求疲軟的影響，主要是在汽車解決方案和電氣領域。

So the electrical, as you can see, our margin pressure for the quarter came from really two main things. One is on the labor increases in Mexico. And many of them aware that there's some government mandate of labor cost increase in the border region of Mexico up to about 20%-ish. So it's really impacting some of our locations in the electrical business.

因此，正如您所看到的，我們本季的利潤壓力實際上來自兩個主要因素。其中之一是墨西哥勞動力的增加。他們中的許多人都意識到，政府要求墨西哥邊境地區的勞動成本增加最多 20% 左右。因此，這確實影響了我們在電力業務中的一些地點。

And then the other one that is also creating some cost pressure for us is of the strengthening of the Mexican peso, which compared to a year ago, is a double digit increase in terms of the cost of our Mexican peso denominated costs are to us. So we're working on both and one is continue to do some reduction in our cost structure. We taking our labor, our rightsizing the overhead at the same time. And more importantly, we're also working with our customer commercially to resolve some of these cost pressures. I would say that we have made some progress already in terms of offsetting some of the labor inflation, but we're still working through offsetting some of the peso strengthening cost pressure for us.

另一個也帶給我們成本壓力的因素是墨西哥比索的走強，與一年前相比，我們以墨西哥比索計價的成本增加了兩位數。因此，我們正在這兩方面努力，其中之一是繼續降低我們的成本結構。我們在吸收勞動力的同時，也調整了管理費用。更重要的是，我們也與客戶進行商業合作，以解決其中一些成本壓力。我想說，我們在抵消部分勞動力通膨方面已經取得了一些進展，但我們仍在努力抵消一些比索加強的成本壓力。

So we'll continue those efforts in Q2, but we believe that we should be able to work with our customer to find some solutions.

因此，我們將在第二季度繼續這些努力，但我們相信我們應該能夠與客戶合作找到一些解決方案。

In referencing of the other part of your question, last year, we said we achieved $30 million or approximately $30 million of cost-out activity at a gross level gross projects. And then obviously the net once you roll inflation and other things, it brings that number down. But we are on track to a similar number this year, both logistics and supply chain as well as direct material. And we're taking a fresh look at indirect spend as well to achieve that same level. So we are leaning in, I would say more specifically this year and other areas in addition to direct material, some of our direct material is directed buy from our customers. We have a little less opportunity there than the spend that we have or we select our own suppliers and drive savings. So framework that was put in place last year to drive the focus on direct materials, still there the framework that was put in place last year to have a specific cost out there for manufacturing facility. Our conversion cost is still in place pursuing that more emphasis. Now this year pretty much driven by some macro items. So freight and logistics is one area with the disruption in the Suez Canal and some of our supply chains that go across region that has caused us to take a more specific look at our freight and logistics and supply chain cost and see what opportunity we can get there.

在提到你問題的另一部分時，我們去年表示，我們實現了 3000 萬美元，或者說，在項目總規模上，我們實現了約 3000 萬美元的成本支出活動。顯然，一旦你滾動通貨膨脹和其他因素，這個數字就會下降。但今年我們有望達到類似的數字，無論是物流、供應鏈或直接材料。我們也正在重新審視間接支出，以達到相同的水平。所以我們正在傾斜，我會更具體地說，今年和其他領域除了直接材料之外，我們的一些直接材料是從我們的客戶那裡直接購買的。我們在那裡的機會比我們擁有的支出要少一些，或者我們選擇自己的供應商並節省開支。因此，去年為推動對直接材料的關注而製定的框架仍然存在，去年為確定製造設施的具體成本而製定的框架仍然存在。我們的轉換成本仍然存在，以更加重視這一點。今年幾乎是由一些宏觀項目推動的。因此，貨運和物流是蘇伊士運河和我們一些跨地區供應鏈中斷的領域之一，這促使我們更具體地審視我們的貨運、物流和供應鏈成本，看看我們能獲得什麼機會在那裡。

Also looking at onshoring or near-shoring to reduce long supply chains, which have both FX risks as well as supply chain risk.

也考慮在岸或近岸來減少長供應鏈，這既有外匯風險也有供應鏈風險。

So there are a number of items we're looking at to achieve that similar level of savings at a gross level that we achieved last year for this year, which is helping us further solidify our range on the EBITDA marginal.

因此，我們正在考慮採取一些措施，以實現今年與去年實現的總水平類似的節省水平，這有助於我們進一步鞏固 EBITDA 邊際範圍。

Thank you.

謝謝。

Appreciate Keith seems to be no further questions at this time. I'd now like to turn the call back over to Mr. Ray for final closing comments.

欣賞基斯此時似乎沒有進一步的問題了。現在我想將電話轉回給雷先生以徵求最後的總結意見。

I'd like to thank you all for joining today's call.

我要感謝大家參加今天的電話會議。

We remain excited for the prospects that we see for CVG as we continue to execute our forward-looking strategy of resource alignment, cost management and customer engagement.

隨著我們繼續執行資源調整、成本管理和客戶參與的前瞻性策略，我們對 CVG 的前景仍然感到興奮。

We reaffirm our business outlook and we look forward to continuing to drive growth at CVG. I hope you all have a great day and a safe day. Thank you very much for joining the call.

我們重申我們的業務前景，並期待繼續推動 CVG 的成長。我希望你們都有美好的一天和安全的一天。非常感謝您加入通話。

Thank you.

謝謝。

Ladies and gentlemen, that concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines and have a lovely day.

女士們、先生們，今天的電話會議到此結束。我們感謝您的參與，並請您斷開線路並祝您度過愉快的一天。