Element Solutions Inc (ESI) 2024 Q4 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Element Solutions fourth quarter and full year 2024 financial results conference call. (Operator Instructions) I will now turn the call over to Varun Gokarn, Vice President, Strategy & Integration. Please go ahead.

女士們、先生們，早安，歡迎參加 Element Solutions 2024 年第四季和全年財務業績電話會議。 （操作員指示）現在我將電話轉給策略與整合副總裁 Varun Gokarn。請繼續。

Good morning, and thank you for participating in our fourth quarter and full year 2024 earnings conference call. In accordance with Regulation FD, we are webcasting this conference call. A replay will be made available in the Investors section of the company's website. During today's call, we will make certain forward-looking statements that reflect our current views about the company's future performance and financial results. These statements are based on assumptions and expectations of future events, which are subject to risks and uncertainties.

早安，感謝您參加我們的 2024 年第四季和全年財報電話會議。根據公平揭露規則，我們將對本次電話會議進行網路直播。重播將在公司網站的投資者部分提供。在今天的電話會議中，我們將做出一些前瞻性陳述，反映我們對公司未來業績和財務表現的當前看法。這些陳述是基於對未來事件的假設和預期，而這些假設和預期受風險和不確定性的影響。

Please refer to our earnings release, supplemental slides and most recent SEC filings for a discussion of material risk factors that could cause actual results to differ from our expectations and predictions. Today's materials also include financial information that has not been prepared in accordance with US GAAP. Please refer to the earnings release and supplemental slides for definitions and reconciliations of these non-GAAP measures to comparable GAAP financial measures.

請參閱我們的收益報告、補充投影片和最新的 SEC 文件，以了解可能導致實際結果與我們的預期和預測不同的重大風險因素的討論。今天的材料還包括未按照美國公認會計準則編制的財務資訊。請參閱收益報告和補充投影片，以了解這些非 GAAP 指標與可比較 GAAP 財務指標的定義和對帳。

It is now my pleasure to introduce our CEO, Ben Gliklich.

現在我很高興介紹我們的執行長 Ben Gliklich。

Thank you, Varun, and good morning, everybody. Thank you for joining. Element Solutions had an outstanding year in 2024. We produced record results, improved our portfolio and positioned the company for longer-term outperformance. We delivered full year adjusted EBITDA above the high end of our original guidance range despite a material incremental FX headwind that had built over the year. The company improved meaningfully across multiple vectors in each of our businesses. We outperformed our markets, penetrating the fastest-growing emerging niches in the electronics industry, driving margins and investing in new capabilities.

謝謝你，瓦倫，大家早安。感謝您的加入。 Element Solutions 在 2024 年表現出色。我們創造了創紀錄的業績，改善了我們的產品組合，並為公司長期的卓越表現做好了準備。儘管全年外匯逆風不斷加大，但我們全年調整後的 EBITDA 仍高於我們最初預期範圍的高端。公司在各個業務領域的多個方面都取得了顯著進步。我們超越了市場表現，打入了電子產業成長最快的新興市場，提高了利潤率，並投資於新的能力。

Adjusted EBITDA grew 13% in constant currency to a record $535 million. Free cash flow of $294 million was a record as well. It was our fifth year out of the past six in which we converted more than 50% of adjusted EBITDA to free cash flow, and that is despite having more opportunities to invest in growth and, therefore, spending more on CapEx than in prior years.

調整後 EBITDA 以固定匯率計算成長 13%，達到創紀錄的 5.35 億美元。 2.94 億美元的自由現金流也創下了新高。在過去六年中，我們已經有第五年將超過 50% 的調整後 EBITDA 轉換為自由現金流，儘管我們有更多的機會投資成長，因此在資本支出上的支出也比前幾年要多。

These results were not a product of a generally exuberant market backdrop. Only select niches of the electronics industry were strong, while a large portion across consumer goods and automotive was generally soft. MSI growth came in well below the market's expectation entering the year, and our industrial business fought headwinds from low levels of activity in construction, heavy machinery and Western automotive manufacturing.

這些結果並非普遍繁榮的市場背景的產物。只有電子產業的部分細分市場表現強勁，而消費品和汽車產業的大部分市場普遍表現疲軟。 MSI 的成長在年初遠低於市場的預期，而且我們的工業業務受到建築、重型機械和西方汽車製造業活動水準低下的阻力。

Notwithstanding that backdrop, we met our financial commitments in 2024, but more importantly, we made meaningful progress continuing to position our business for longer-term outperformance. We're a critical supplier of solutions for leading -edge electronics hardware.

儘管如此，我們仍然在 2024 年履行了財務承諾，但更重要的是，我們在繼續定位我們的業務以實現長期優異表現方面取得了有意義的進展。我們是尖端電子硬體解決方案的重要供應商。

Our product road maps are increasingly informed by and critical to emerging needs in high-performance computing markets and our relationships with the key specifiers and technologists in the markets are strengthening. We worked hard to bring our margins back close to their prior high. With over 100 basis points of EBITDA margin expansion in 2024, we've just about accomplished that. We've shown price discipline and driven positive mix through our progress in high-value niches and electronics.

我們的產品路線圖越來越受到高效能運算市場新興需求的影響並對其至關重要，我們與市場中關鍵規範制定者和技術專家的關係也在加強。我們努力將利潤率恢復到接近之前的高點。隨著 2024 年 EBITDA 利潤率擴大超過 100 個基點，我們幾乎已經實現了這一目標。透過在高價值市場和電子產品領域的進步，我們展示了價格紀律並推動了積極的組合。

And we're back at those levels in a period of weak volume in Industrial and Assembly. So we see a path to set new record margins from greater facility utilization and further mix improvement from here. In 2024, we also took steps to focus and enhance our portfolio. In September, we announced an agreement to sell Macdermid Graphics Solutions for $325 million.

在工業和組裝業銷售疲軟的時期，我們又回到了這些水準。因此，我們看到了透過提高設施利用率和進一步改善產品組合來創下利潤新紀錄的途徑。 2024年，我們也採取措施集中並增強我們的投資組合。 9 月份，我們宣布以 3.25 億美元的價格出售 Macdermid Graphics Solutions。

This is a good business, but it contributed lower growth and margins and with weaker cash flow conversion than the rest of our businesses. We were able to structure the transaction to take advantage of tax assets such that we should net almost all of the proceeds. It's expected to close in the first quarter, subject to customary closing conditions and adjustments.

這是一項不錯的業務，但其成長和利潤率較低，現金流轉換也比我們的其他業務弱。我們能夠建立交易來利用稅收資產，這樣我們就可以獲得幾乎所有的收益。預計交易將在第一季完成，但須符合慣例成交條件和調整。

And so we are left here with a better portfolio across all key relevant metrics that we believe is also better positioned for growth and a balance sheet that is as good as it has been since we founded ESI. This is all to say that while we're pleased with a record year in 2024, we're even more excited about what we were able to do last year to position the business for longer-term success. Carey will now take you through the fourth quarter and full year financials in more detail. Carey?

因此，我們在所有關鍵相關指標上都擁有更好的投資組合，我們相信這些投資組合也更有利於成長，資產負債表也與我們成立 ESI 以來一樣好。總而言之，雖然我們對 2024 年創紀錄的一年感到高興，但我們對去年為實現業務的長期成功所做的努力感到更加興奮。凱裡現在將向您更詳細地介紹第四季和全年的財務狀況。凱莉？

Thanks, Ben. On slide 4, you can see a summary of our fourth quarter results. Net sales increased 6% organically as we grew our high-end Electronics verticals in the double digits and saw sequential improvement in the Industrial portfolio, driven by demand in Asia. Growth was led by Semiconductor Solutions at 19% and Circuitry Solutions at 10%. Our circuit board assembly business, which has more industrial and consumer electronics exposure, grew more modestly. We saw the same divergence in Electronics throughout 2024. Emerging technologies are requiring more complex material solutions.

謝謝，本。在投影片 4 上，您可以看到我們第四季業績的摘要。由於我們的高端電子垂直市場實現了兩位數成長，且在亞洲需求的推動下，工業產品組合也實現了連續改善，因此淨銷售額有機成長了 6%。半導體解決方案和電路解決方案分別成長 19% 和 10%。我們的電路板組裝業務更涉及工業和消費性電子產品，成長較為溫和。在整個 2024 年，我們看到電子領域也出現了同樣的分歧。新興技術需要更複雜的材料解決方案。

We are a key provider of those solutions, whether they serve the AI data center market, the Chinese electric vehicle market or the low earth orbit satellite market. These advanced packaging solutions, complex multilayer printed circuit board process chemistries and high reliability thermal materials are driving the business in a period of sluggish consumer electronics demand overall. We expect that to continue, though these emerging applications are gaining as a percentage of the overall electronics market. The benefit of our iterative customer-led innovation is that our intimacy with these markets and our capabilities to serve them give us a valuable seat at the table that should drive further outperformance in the years to come.

我們是這些解決方案的主要供應商，無論它們服務於人工智慧資料中心市場、中國電動車市場或低地球軌道衛星市場。這些先進的封裝解決方案、複雜的多層印刷電路板製程化學和高可靠性的導熱材料在整體消費性電子產品需求低迷的時期推動著業務的發展。儘管這些新興應用在整個電子市場中所佔的比例正在增加，但我們預計這種趨勢仍將持續下去。我們以客戶為主導的迭代創新的好處在於，我們與這些市場的親密關係以及我們為這些市場提供服務的能力，為我們提供了寶貴的市場地位，並將在未來幾年推動我們取得進一步的優異表現。

On the bottom line, constant currency adjusted EBITDA grew 9% year-on-year with margins roughly flat to the fourth quarter prior period. Adjusted EBITDA was in our guidance range despite an incremental $3 million FX headwind in the quarter. While most of our input costs have eased, higher pass-through metals in our assembly business generated a year-on-year headwind to company margins of roughly 80 basis points. Excluding net sales from these pass-through metals, our adjusted EBITDA margin would have been 25%, representing 60 bps of margin expansion.

從底線來看，經固定匯率調整後的 EBITDA 年成長 9%，利潤率與上一季第四季基本持平。儘管本季外匯逆風增加 300 萬美元，調整後的 EBITDA 仍處於我們的指導範圍內。雖然我們的大部分投入成本已經降低，但在裝配業務中轉嫁金屬量的增加導致公司利潤率比去年同期下降約 80 個基點。不包括這些轉嫁金屬的淨銷售額，我們的調整後 EBITDA 利潤率將達到 25%，相當於利潤率擴大 60 個基點。

On slide 5, we discuss full year financial results. Overall, organic sales grew 4%, driven by emerging sources of demand in electronics, even as European industrial end markets remain soft. Our Electronics business grew 7% organically, while the Industrial and Specialty segment declined 1%. On a constant currency basis, adjusted EBITDA improved 13% year-on-year. Constant currency adjusted EBITDA margins improved 120 basis points, reflecting favorable product mix from high-end electronics growth as well as price discipline and easing input costs.

在投影片 5 上，我們討論全年財務表現。總體而言，儘管歐洲工業終端市場依然疲軟，但受電子產品新興需求的推動，有機銷售額仍成長了 4%。我們的電子業務有機成長了 7%，而工業和專業業務則下降了 1%。以固定匯率計算，調整後的 EBITDA 年成長 13%。經固定匯率調整後的 EBITDA 利潤率提高了 120 個基點，反映出高階電子產品成長帶來的良好產品組合、價格紀律和投入成本的降低。

Excluding the impact of roughly $400 million of pass-through metal sales in our Assembly Solutions business, our adjusted EBITDA margin would have been 26% for the year. This is a very strong result, but we see room for further improvement. Foreign exchange translation was a $12 million year-on-year headwind to adjusted EBITDA and roughly $0.03 headwind to adjusted EPS. Currencies continue to be volatile and currency rates present additional FX headwinds in 2025, as Ben will cover shortly.

不計組裝解決方案業務中約 4 億美元轉嫁金屬銷售的影響，我們今年的調整後 EBITDA 利潤率將達到 26%。這是一個非常好的結果，但我們也看到了進一步改進的空間。外匯折算對調整後的 EBITDA 造成了年比 1,200 萬美元的不利影響，對調整後的 EPS 造成了約 0.03 美元的不利影響。貨幣持續波動，貨幣匯率將在 2025 年帶來額外的外匯阻力，Ben 稍後將介紹這一點。

Next, on slide 6, we share additional detail on full year organic results. Semiconductor Solutions organic growth of 14% reflected steady improvements in fab utilization, new fab ramps and broader growth in advanced packaging applications. Demand for our ViaForm products was particularly robust, and we expect this demand to carry into 2025, supporting advanced logic nodes and DRAM memory stacking, which are critical for AI applications. We also continue to see strong growth in power electronics for the electric vehicle market as efforts to win new customers through our technology are paying off.

接下來，在第 6 張投影片上，我們將分享更多有關全年有機業績的詳細資訊。半導體解決方案有機成長 14%，反映出晶圓廠利用率的穩定提高、新晶圓廠的投產以及先進封裝應用的更廣泛增長。我們對 ViaForm 產品的需求特別強勁，我們預計這種需求將持續到 2025 年，支援對 AI 應用至關重要的先進邏輯節點和 DRAM 記憶體堆疊。隨著我們利用科技贏得新客戶的努力取得成效，我們也持續看到電動車市場電力電子產品的強勁成長。

In 2024, Semiconductor Solutions marked a milestone with revenue exceeding $300 million for the first time. This business has grown at a 5-year CAGR of 14% and should continue with a double-digit growth trajectory from here. Circuitry Solutions grew 12% organically in 2024, benefiting from the large investments made by hyperscalers into AI and data center growth. Additionally, the growth of electric vehicles in China has driven demand for certain of our market-leading final finish products. Overall, Circuitry outpaced estimated global smartphone growth of 6% in 2024, which is meaningfully lower among Western OEMs as well as estimated PCB square meter growth of 7%. We expect this business can continue its outperformance and strong growth even as smartphones remain below prior peak levels.

2024年，半導體解決方案業務營收首度突破3億美元，創下里程碑。該業務的 5 年複合年增長率為 14%，並且今後應繼續保持兩位數的成長軌跡。受益於超大規模企業對人工智慧和資料中心成長的大量投資，Circuitry Solutions 在 2024 年實現了 12% 的有機成長。此外，中國電動車的成長推動了我們某些市場領先的最終成品的需求。總體而言，Circuitry 的成長速度超過了預計 2024 年全球智慧型手機 6% 的成長率，而西方 OEM 的成長率則明顯較低，PCB 面積成長率預計為 7%。我們預計，即使智慧型手機的銷量仍低於先前的峰值水平，該業務仍能繼續保持優異的表現和強勁的成長。

Our Assembly Solutions business has more significant exposure to industrial and automotive end markets than our other electronics verticals as we supply high reliability alloys and attachment technologies for automotive markets, industrial customers and broader consumer electronics. Global automotive volume was essentially flat in 2024 and saw meaningful declines in Europe. However, our business benefited from demand improvement in consumer, mobile and computing end markets, particularly in Asia. This business grew 1% organically for the full year with low single-digit year-on-year improvement in the second half.

由於我們為汽車市場、工業客戶和更廣泛的消費性電子產品提供高可靠性合金和連接技術，因此我們的組裝解決方案業務在工業和汽車終端市場的影響力比其他電子垂直市場更大。 2024 年全球汽車銷售量基本持平，歐洲汽車銷售量大幅下降。然而，我們的業務受益於消費、行動和運算終端市場（尤其是亞洲）需求的改善。該業務全年有機成長 1%，下半年年成長率僅個位數。

Organic net sales in the Industrial and Specialty segment fell 1% year-over-year. Industrial Solutions, which is almost 3/4 of the segment, declined 2% organically, driven by lower commodity price-based surcharges and soft European industrial end markets. It did, however, deliver earnings growth this year from margin expansion on the back of mix, cost inflation and facility rationalization. Energy Solutions top line grew 8% organically. Drilling and production activity remained strong, and we have had the opportunity to drive pricing in this business as well. These trends are expected to continue into 2025.

工業和特種產品部門的有機淨銷售額年減 1%。佔該部門近四分之三的工業解決方案有機下滑了 2%，因為商品價格附加費下降和歐洲工業終端市場疲軟。然而，在產品組合、成本上漲和設施合理化的推動下，該公司今年確實因利潤率提高而實現了獲利成長。能源解決方案營收有機成長 8%。鑽井和生產活動依然強勁，我們也有機會推動該業務的定價。預計這些趨勢將持續到 2025 年。

Moving to cash flow and the balance sheet on slide 7. Element Solutions generated a record $294 million of free cash flow in the year, of which $116 million was in the fourth quarter. Our working capital investment was fairly modest relative to our adjusted EBITDA growth, primarily thanks to improved inventory management. We have highlighted a desire and opportunity to improve working capital management over the course of 2024, and we executed against it. We spent $68 million in CapEx in '24 as we made significant progress on several key strategic investments in power electronics manufacturing and our broad manufacturing and research footprint. We believe this is money very well spent behind high-value growth opportunities.

前往投影片 7 上的現金流量和資產負債表。 Element Solutions 在去年創造了創紀錄的 2.94 億美元自由現金流，其中 1.16 億美元來自第四季。與調整後的 EBITDA 成長相比，我們的營運資本投資相當溫和，這主要歸功於庫存管理的改善。我們強調了在 2024 年改善營運資本管理的願望和機會，並且我們已為此付諸行動。我們在24年花費了6,800萬美元的資本支出，因為我們在電力電子製造和廣泛的製造和研究領域的幾項關鍵策略投資方面取得了重大進展。我們相信，這些錢花在高價值成長機會上是非常值得的。

We expect to spend roughly $65 million of CapEx in 2025. We ended the year with our balance sheet in a strong position. Net leverage was 2.8x, and our capital structure is more than 90% fixed-rate through 2028. We now have no debt or swap maturities until 2028, and our effective borrowing cost is below 4%. On a pro forma basis, net leverage would have been 2.3 times at year-end, if the Graphics transaction had closed as of January 1, 2024. As a result, we have substantial capacity to deploy capital in 2025 and beyond.

我們預計 2025 年的資本支出約為 6,500 萬美元。今年結束時，我們的資產負債表狀況良好。淨槓桿率為 2.8 倍，到 2028 年，我們的資本結構中超過 90% 為固定利率。我們現在到 2028 年都沒有債務或掉期到期日，我們的有效借貸成本低於 4%。根據預測，如果 Graphics 交易於 2024 年 1 月 1 日完成，那麼到年底的淨槓桿率將達到 2.3 倍。因此，我們擁有在 2025 年及以後部署資本的強大能力。

And with that, I will turn the call back to Ben to discuss our outlook. Ben?

說完這些，我將把電話轉回給本，討論我們的前景。本？

Thank you, Carey. In 2024, we executed well against the backdrop and our relevant opportunity set. We anticipate a continuation of the trends we saw last year into 2025, and you should expect us to execute as well or better. Demand continues to grow in high-performance computing and data storage applications. This should drive our wafer level and advanced packaging-related product lines. We continue to extend our penetration of the EV market with our differentiated power electronics solutions, and we expect market growth and our share gains in high-value semiconductor markets to continue. Altogether, we expect 2025 organic growth in our Electronics segment at our high single-digit longer-term target.

謝謝你，凱裡。 2024年，我們在背景和相關機會的指導下表現良好。我們預計去年的趨勢將延續到 2025 年，並​​且您應該期待我們能表現得一樣好甚至更好。高效能運算和資料儲存應用的需求持續成長。這將推動我們的晶圓級和先進封裝相關產品線。我們繼續憑藉差異化的電力電子解決方案擴大在電動車市場的滲透率，並預計市場成長和我們在高價值半導體市場的份額成長將持續。整體而言，我們預計到 2025 年電子部門的有機成長率將達到高個位數的長期目標。

There's also the potential for a stronger refresh cycle on both smartphones and other computing devices, which could buoy volume growth for the electronics manufacturing industry overall. That would be upside to our plan. On the I&S side, the outlook for global industrial production is more uncertain. We expect a similar environment to 2024, though there's some risk from the impact of potential tariffs on demand. We continue to win business in this market and expect another year of outperformance relative to industrial activity in 2025. Our offshore business should once again benefit from balanced growth in both volume and prices.

智慧型手機和其他計算設備的更新周期也有可能加快，這可能會推動整個電子製造業的產量成長。這對我們的計劃有利。工業與社會方面，全球工業生產前景更不確定。我們預期環境與 2024 年類似，儘管潛在關稅對需求的影響會帶來一些風險。我們繼續在這個市場上贏得業務，並預計 2025 年相對於工業活動而言，我們將再次取得優異表現。我們的海上業務應再次受益於產量和價格的平衡成長。

We anticipate two major nonoperational impacts to adjusted EBITDA year-over-year. First, the sale of Graphics will account for a roughly $30 million impact, which includes a modest adjusted EBITDA contribution from the business in January and February. Second, the stronger U.S. dollar will drive translational headwinds, which would be roughly $15 million year-over-year based on January ending rates. Overall, when accounting for these dynamics for full year 2025, we are guiding to high single-digit adjusted EBITDA growth at the midpoint of our range.

我們預計，調整後的 EBITDA 將年比受到兩大非經營性影響。首先，Graphics 業務的出售將產生約 3,000 萬美元的影響，其中包括 1 月和 2 月該業務適度調整後的 EBITDA 貢獻。其次，美元走強將帶來翻譯的阻力，以 1 月底的匯率計算，年比將增加約 1,500 萬美元。總體而言，考慮到 2025 年全年的這些動態因素，我們預計調整後的 EBITDA 將達到範圍中點的高個位數成長。

We expect Q1 adjusted EBITDA of approximately $125 million, which includes a roughly $5 million FX headwind. Our full year adjusted EPS guidance of approximately $1.40 does not include any benefit from capital allocation. Just as in 2024, we will measure success this year by not only delivering on our financial goals, but also by continuing to improve our long-term positioning for outsized growth and value creation.

我們預計第一季調整後的 EBITDA 約為 1.25 億美元，其中包括約 500 萬美元的外匯不利因素。我們對全年調整後每股收益的預期約為 1.40 美元，其中不包括任何資本配置收益。正如 2024 年一樣，我們今年衡量成功的標準不僅是實現財務目標，還要繼續改善我們的長期定位，實現超額成長和價值創造。

To that end, on slide 9, we've reflected our definition of success for the year. We aim to execute at a high level, continue to penetrate the fastest-growing, deepest profit pools available to us and, therefore, gain share of and outperform our markets. In order to continue to do that for the long term, we must make progress with customers and the supply chains for our emerging technologies such as ActiveCopper or Kuprion and other advanced and wafer level packaging and semiconductor assembly products.

為此，在第 9 張投影片上，我們反映了我們對今年成功的定義。我們的目標是高水準執行，繼續滲透到成長最快、利潤最大的市場，從而獲得市場份額並超越市場。為了長期繼續這樣做，我們必須與客戶和新興技術（如ActiveCopper或Kuprion以及其他先進和晶圓級封裝和半導體組裝產品）的供應鏈一起取得進展。

Finally, we expect opportunities to deploy our balance sheet capacity to accelerate adjusted earnings per share growth through complementary tuck-in acquisitions and also as appropriate through share repurchase. We have the team, technology and playbook to deliver on this, and our conviction in the long-term trajectory for our business continues to grow.

最後，我們期待有機會部署我們的資產負債表能力，透過互補的補充收購以及適當情況下的股票回購來加速調整後每股盈餘的成長。我們擁有團隊、技術和策略來實現這一目標，我們對業務長期發展的信心不斷增強。

That conviction relies on the pillars of our business, which are our people, our technology and our deep customer and supply chain intimacy. The most important of those pillars is our team. I'm immensely grateful to our dedicated, capable people around the world who are responsible for our excellent 2024 and will be the drivers of our success in 2025 and beyond.

這一信念依賴於我們業務的支柱，即我們的員工、我們的技術以及我們與客戶和供應鏈的深厚關係。這些支柱中最重要的是我們的團隊。我十分感謝我們在世界各地的敬業、能幹的員工，是他們成就了我們出色的 2024 年，也將成為我們在 2025 年及以後取得成功的推動者。

With that, operator, please open the line for questions.

接線員，請打開熱線來回答問題。

(Operator Instructions) Josh Spector, UBS.

(操作員指示) Josh Spector，瑞銀。

Yeah, hey, good morning guys. So first, I just wanted to ask on your view of your relative performance compared to electronics markets in your Electronics segment. I mean, clearly, you had a strong 2024, obviously, a weaker comp off '23. So on that two year basis, how do you think you performed relative to markets?

是的，嘿，大家早安。所以首先，我想問一下，您如何看待您們相對於電子市場在電子領域的相對錶現。我的意思是，很明顯，2024 年的表現很強勁，而 23 年的表現顯然較弱。那麼，以這兩年為基礎，您認為您的表現相對於市場而言如何？

And when you look forward, you're talking about new wins. Obviously, we've been talking about advanced packaging for a while. Does that outperformance accelerate meaningfully that we should be able to see it? Or do you view it kind of a similar level of outperformance?

當你展望未來時，你談論的是新的勝利。顯然，我們已經談論先進封裝有一段時間了。這種優異表現是否有意義地加速，以至於我們能夠看到它？或者您認為它的表現水平類似嗎？

Yes. Thanks for the question, Josh. So a few relevant data points, right, that we went through just now in our prepared remarks. PCB square meters were up maybe 6%, 7%, smartphones up 6%. MSI, low single digits, and our business was up in the high single digits from an electronics perspective. So we outperformed this year in a, call it, modest recovery within the electronics market.

是的。謝謝你的提問，喬希。所以，我們剛才在準備好的發言中討論過一些相關的數據點。 PCB 平方公尺數可能上漲了 6%、7%，智慧型手機上漲了 6%。 MSI 的成長幅度為個位數低位，而從電子角度來看，我們的業務成長幅度為個位數高位。因此，我們在今年電子市場的溫和復甦中表現出色。

Last year, we outperformed units on the way down as well. So I think you've seen us do better in weaker periods and do better in stronger periods, and that's really a product of our penetrating the fastest-growing subsegments of the electronics hardware market.

去年，我們的表現也優於下滑的單位。所以我想你已經看到我們在較弱的時期做得更好，在較強的時期做得更好，這實際上是我們滲透到電子硬體市場成長最快的細分市場的結果。

Taking a step back, we had record EBITDA in 2024 for Element Solutions, and that's at a period where MSI is way dislocated from its prior peak. Smartphones are way off of their prior peak. PCB square meters are below their prior peak. And so Element as a complex has clearly outperformed the underlying markets over a multiyear period.

回顧一下，2024 年 Element Solutions 的 EBITDA 創下了歷史新高，而此時 MSI 已經遠遠偏離了先前的峰值。智慧型手機已經遠遠落後於先前的巔峰。 PCB 面積目前低於先前的峰值。因此，Element 作為一個綜合體，在多年的時間裡表現明顯優於基礎市場。

Rolling that forward, the subsegments that we've grown in and developed a level of incumbency in are the secular growing highest value subsegments of the electronics consumables market, and those should continue to outpace the overall market. And so I think that we have a high -- I know we have a high level of conviction that this level of outperformance should continue.

展望未來，我們已經成長並發展到一定程度的細分市場是電子消耗品市場中長期成長的最高價值細分市場，這些細分市場應該會繼續超過整體市場。因此我認為，我們非常有信心——我知道我們非常有信心，這種優異的表現水準將會持續下去。

Bhavesh Lodaya, BMO Capital Markets.

Bhavesh Lodaya，BMO 資本市場。

Hi, good morning. Your business is pretty short cycle in nature. So I would guess it's still early for you to see how the year is trending. Could you add some color around maybe your customer communication or maybe where you are in some of the product development cycles as to what scenarios you're building in as we think about the lower end and the higher end of your EBITDA range?

嗨，早安。您的業務週期本質上相當短。因此，我猜現在判斷今年的趨勢還為時過早。當我們考慮您的 EBITDA 範圍的低端和高端時，您能否詳細介紹一下您的客戶溝通情況，或者您在某些產品開發週期中所處的位置，以及您正在建立的場景？

Yes. Well, you're right to point out it's a short-cycle business, right? Our customers' customers don't know how many products they're going to sell over the course of -- or how many units they're going to sell over the course of 2025. And so the supply chain has limited visibility in that regard.

是的。嗯，你說得對，這是一項短週期業務，對嗎？我們的客戶的客戶不知道他們在整個過程中會銷售多少產品，或在 2025 年期間會銷售多少單位。因此，供應鏈在這方面的可視性有限。

So when we sit here in the beginning of the year and give guidance, it's really on the basis of expectations for units whether that's MSI, PCB square meter, smartphone units and so forth. And I think we articulated what we expect from each of those key indicators. What's clear is that at the leading edge, there's not enough capacity.

因此，當我們在年初在這裡提供指導時，它實際上是基於對單位的預期，無論是 MSI、PCB 平方米、智慧型手機單位等等。我認為我們清楚地表達了我們對每個關鍵指標的期望。顯然，在前沿領域，產能還不夠。

And so capacity is coming online, and there's huge investment and huge demand for advanced chips, and we expect that to continue. Where there's more uncertainty is in some of the legacy -- what used to be the leading edge, things like smartphones, obviously, the industrial market and so forth.

因此，產能正在上線，對先進晶片的投資和需求巨大，我們預計這種情況將持續下去。一些遺留的領域存在著更多的不確定性——曾經處於領先地位的領域，例如智慧型手機，當然還有工業市場等等。

You get to the high-end, should there be an accelerated replacement cycle in some of those devices, better health in the industrial market. Obviously, FX can help us. And the low end is, should there be a demand impact from tariffs or a weakening in the industrial markets. I think we all feel pretty good that spend at the leading edge in our highest value areas is going to continue to be robust through the year.

如果你進入高端市場，如果一些設備的更換週期加快，那麼工業市場的健康狀況就會更好。顯然，FX 可以幫助我們。最低端是，關稅是否會對需求產生影響，或者工業市場會變得疲軟。我認為，我們都非常高興，因為我們在最高價值領域的前沿支出將在今年繼續保持強勁成長。

Thanks and as a follow-up, so there's clearly been a significant amount of talks about of tariffs, not just in Asia, but also within North America. Are you seeing any impact from that so far in your business?

謝謝，作為後續問題，顯然已經有大量關於關稅的討論，不僅在亞洲，而且在北美也是如此。您目前覺得這對您的業務有什麼影響嗎？

Not yet. No, we haven't seen a real impact. Obviously, there's a lot of discussion. There's been supply chain realignment going on over the past several years where manufacturing capacity is moving to Mexico. We're seeing an investment in fab capacity in North America, in Japan. We're seeing PCB and automotive suppliers moving into Southeast Asia out of China. None of that is new, and we're benefiting from that. But over the past, call it, two months, we haven't seen any dramatic changes.

還沒有。不，我們還沒有看到真正的影響。顯然，有很多討論。過去幾年來，供應鏈一直在重新調整，製造產能正在轉移到墨西哥。我們看到北美和日本的晶圓廠產能正在投資。我們看到 PCB 和汽車供應商正在從中國遷往東南亞。這些都不是新鮮事，而且我們正在從中受益。但在過去兩個月裡，我們並沒有看到任何顯著的變化。

Chris Parkinson, Wolfe Research.

克里斯·帕金森（Chris Parkinson），沃爾夫研究公司。

Great, good morning. So Ben, I think we can all appreciate the effort of not embedding any meaningful macro recovery in '25 guidance. But from where you sit today, what would be the two data points that investors could potentially look at for upside surprise in terms of what you're seeing right now or what you expect to see soon enough? And what would be the two factors potentially your risks that you're monitoring in terms of how you're progressing throughout the year? Thank you.

太好了，早安。所以本，我認為我們都可以理解在 25 年指導中不嵌入任何有意義的宏觀復甦的努力。但是從您目前所處的位置來看，就您現在看到的或您預計很快會看到的情況而言，投資者可能關注哪兩個數據點以尋找上行驚喜？從您全年的進度來看，您要監控的兩個潛在風險因素是什麼？謝謝。

Yes. Thanks for the question, Chris. Well, the single biggest variable that's been I'd call it the most volatile over the past several months has been FX. So we've got about a $15 million headwind year-over-year using end of January rates. It's a little bit lower today as the dollar has weakened a bit since the end of January.

是的。謝謝你的提問，克里斯。嗯，我認為過去幾個月最不穩定的最大變數是外匯。因此，以 1 月底的利率計算，我們年比面臨約 1500 萬美元的逆風。由於美元自 1 月底以來有所走弱，因此今天美元匯率略有下跌。

It was as high as $20 million in the past two months. And if you go back to the end of September, it was a $10 million tailwind. So we've seen a $30 million swing just from currency over the past several months. And so that is the single biggest variable I'd point to. When you look at organic or units, the automotive market is a critical market for us.

過去兩個月，這數字曾高達2,000萬美元。如果你回顧九月底，這是一個價值 1000 萬美元的順風。因此，在過去幾個月裡，光是貨幣方面我們就看到了 3000 萬美元的波動。這就是我要指出的最大變數。當你看有機或單位時，汽車市場對我們來說是一個關鍵的市場。

And while it's not unhealthy per se from an overall unit perspective, the types of units that are being made are not necessarily beneficial from a mix standpoint, right? So low-value electric vehicles in China as opposed to high-value vehicles made in the West.

雖然從整體單位角度來看這本身並不是不健康的，但從混合角度來看，正在製造的單位類型並不一定是有益的，對嗎？因此，中國生產的電動車價值較低，而西方生產的電動車價值較高。

So some health or recovery in Western automotive would be a tailwind and smartphone units, while they're less core to our growth than they were several years ago, given the emergence of high-performance computing and how much volume we have going into that market today, they're still relevant and a replacement cycle and growth in units above what's expected would be a tailwind.

因此，西方汽車行業的健康或復甦將是一個順風，而智慧型手機業務雖然對我們的成長來說不像幾年前那麼重要，但考慮到高性能運算的出現以及我們今天進入該市場的數量，它們仍然具有相關性，而更換週期和高於預期的業務量增長將是一個順風。

The thing I would point to as risk, again, as I was just mentioning to Bhavesh, is industrial production. And if that gets weaker, that would be the risk not contemplated in our guide.

正如我剛才向 Bhavesh 提到的那樣，我要再次指出的風險是工業生產。如果變得更弱，那將是我們的指南中未考慮到的風險。

That's very helpful. And just as a quick follow-up, when I think about your exposure on -- for EV and smartphone across your portfolio, and I look at basically your mix between China and non-China OEs, how should we be thinking about the trends in those markets for '25 and perhaps even a little bit of a longer-term comment as well? Thank you so much.

這非常有幫助。作為一個簡短的跟進，當我考慮到您的投資組合中對電動汽車和智慧型手機的投資，並基本上看您在中國和非中國原始設備製造商之間的組合時，我們應該如何看待這些市場在 25 年的趨勢，甚至可能還有一點長期評論？太感謝了。

Sure. So we have more value in Western or in ex-Chinese smartphones than in domestic Chinese smartphones. But we still have some value in smartphones from Chinese OEMs, and we saw a benefit from growth in those units in 2024. But the mix is -- skews a bit more towards ex-Chinese OEMs.

當然。因此，與中國國產智慧型手機相比，我們更重視西方或中國以外的智慧型手機。但我們仍然看好中國 OEM 廠商的智慧型手機，而且我們看到 2024 年這些廠商的銷量將會成長。但整體來看，市佔率略微偏向非中國 OEM 廠商。

With regards to electric vehicles or automotive in general, we've got a better penetration ex China. And in EVs, also ex-Chinese EV OEMs, but we're making really good progress in both the broader Chinese OEM -- automotive OEM markets and, in particular, in high-end Chinese electric vehicles where our power electronics technology has been adopted, and we're seeing real growth from them, which is a really nice tailwind and earnings driver in 2025, as units of high-end Chinese EVs are rolling out using our technology.

就電動車或汽車總體而言，我們在中國以外的滲透率更高。在電動車領域，包括前中國電動車原始設備製造商，但我們在更廣泛的中國原始設備製造商（汽車原始設備製造商）市場，特別是在採用我們的電力電子技術的高端中國電動汽車領域都取得了良好的進展，我們看到了真正的增長，這是一個非常好的順風和 2025 年的盈利電動驅動力，因為中國的高端汽車將採用我們的高端汽車。

Michael Harrison, Seaport Research Partners.

麥可‧哈里森（Michael Harrison），海港研究夥伴。

Hi, good morning. I was hoping that you could give us a little bit more color on your expectations in the PCB market. And I'm curious if you're seeing kind of a similar bifurcation where the advanced side of things where you guys have a better position are growing faster, whereas maybe some trailing edge boards are not growing as quickly. Maybe just a little bit more color on your expectations for that assembly business next year.

嗨，早安。我希望您能向我們詳細介紹一下您對 PCB 市場的期望。我很好奇，您是否看到了類似的分叉現象，在事物發展的先進方面，你們佔據著更好的地位，發展得更快，而一些後緣板的發展可能並沒有那麼快。也許您對明年的組裝業務的期望會更加詳細一些。

Absolutely. So it's a great question, and it's a great observation. It's both our circuitry business and our assembly business, and I'll speak to them in order, right? PCB square meters grew mid-single digits last year. Our circuitry business grew 10-ish percent last year. And so what explains that divergence?

絕對地。這是一個很好的問題，也是一個很好的觀察。這既是我們的電路業務，也是我們的組裝業務，我會按順序講它們，對嗎？去年，PCB 面積成長率達到中等個位數。去年我們的電路業務成長了10%左右。那麼如何解釋這種差異呢？

The legacy lower tech circuit boards that go into consumer electronics and cars had far less growth in units than higher value, more complex circuit boards that go into IC substrates, so that's an advanced packaging application or server boards for high-performance compute. And that's where we have a disproportionate position.

用於消費性電子產品和汽車的傳統低技術電路板的銷售增幅遠低於用於集成電路載板的高價值、更複雜的電路板，因此這是一種先進的封裝應用或用於高效能運算的伺服器主機板。這就是我們處於不相稱地位的地方。

And that's why we outperformed that market so substantially in 2024. And we expect that same trend to continue in 2025, right? So the high-end circuit board market is healthy. The low-end is suffering along with weak industrial production. We expect that to continue. And so we expect to outperform that market in 2025 once again.

這就是為什麼我們在 2024 年的表現遠遠超過該市場。我們預計同樣的趨勢將在 2025 年繼續下去，對嗎？因此高端電路板市場是健康的。隨著工業生產疲軟，低端產業也受到影響。我們預計這種情況將持續下去。因此，我們預計 2025 年的表現將再次超越該市場。

The assembly business is a bit different, where we're selling assembly materials that go into a broader set of the electronics market than our circuit board business. And so the assembly business didn't grow to the same rate as our circuitry business, and that's really driven by its exposures.

組裝業務略有不同，我們銷售的組裝材料比電路板業務涉及的電子市場範圍更廣泛。因此，組裝業務的成長速度不如我們的電路業務快，這實際上是受其風險敞口所驅動。

But we were still able to drive profit growth, pretty significant profit growth from the assembly business. And that's because the higher value applications in assembly once again, are in the higher technology segments of that market. Again, we need to think about this ex metal because metal prices increased over the course of the year, but our profit percent in that business improved and our profit dollars improved because of where the growth came from in our assembly product portfolio. And again, we would expect that to continue in 2025.

但我們仍能推動利潤成長，裝配業務的利潤成長相當顯著。這是因為裝配中的高價值應用再次處於該市場的高端技術領域。再次，我們需要考慮金屬以外的因素，因為金屬價格在一年內上漲，但我們在該業務中的利潤百分比提高了，利潤金額也提高了，這是因為我們的組裝產品組合帶來了成長。我們預計這種情況將在 2025 年繼續持續。

All right. And then you referenced the potential to put some capital to work this year and the balance sheet being in pretty good shape. Can you talk about the M&A market? And are you seeing more targets out there and valuations maybe getting a little bit more reasonable than they have been in the past couple of years?Thank you.

好的。然後您提到今年有潛力投入一些資本並且資產負債表狀況相當良好。能談談併購市場嗎？您是否看到更多的目標和估值可能比過去幾年更合理一些？謝謝。

Yes, absolutely. So our balance sheet is as good as it's been since we founded Element when you take into consideration the proceeds from the graphics sale, which would be coming in pretty soon here. And so we are on the front foot looking for opportunities to deploy that balance sheet to compound earnings.

是的，絕對是如此。因此，如果考慮到圖形銷售的收益（很快就會到帳），我們的資產負債表和我們成立 Element 以來一樣好。因此，我們積極尋找機會部署資產負債表來實現複合收益。

Tuck-in M&A is on the table. The types of businesses we're looking for are really high quality, just like our business. There aren't that many businesses that sort of pass that bar out in the market. And so we're out nurturing relationships to try to activate that all the time. And I do expect we should be able to find some attractive tuck-ins over the course of the year at reasonable values that meet our criteria.

內部併購正在醞釀。我們正在尋找的業務類型確實是高品質的，就像我們的業務一樣。市場上能通過這項考驗的企業並不多。因此，我們一直在努力培養關係並嘗試激活這種關係。我確實希望我們能夠在今年內找到一些符合我們標準的、價格合理且有吸引力的小吃。

But we still have capacity beyond that for repurchase, a bit of incremental debt paydown. With the balance sheet as it is, I don't think we're limited in terms of what we can do over 2025, always with an eye towards compounding per share value.

但除此之外，我們仍有能力進行回購和少量增量債務償還。有了現有的資產負債表，我認為我們在 2025 年能做的事情不會受到限制，我們始終著眼於每股價值的複合成長。

John Roberts, Mizuho.

瑞穗的約翰羅伯茲。

Thank you. One of your peers, Entegris has consolidated its segments to two. And I think DuPont's electronics spin is just going to have two segments. Do you think about consolidation within your electronics portfolio maybe to just two segments like maybe pulling together the advanced packaging and wafer level packaging stuff all in one place?

謝謝。您的同行之一 Entegris 已將其業務部門合併為兩個。我認為杜邦的電子業務將分為兩個部分。您是否考慮將電子產品組合整合為兩個部分，例如將先進封裝和晶圓級封裝產品整合到一個地方？

Interesting question, John. I hadn't thought about that. We have one Electronics segment with three verticals. And as we've done more investor education about our electronics business, we've actually tried to break it out further, to clarify what we have in front end, what we have in back end, what we have in circuitry and what we have in assembly.

有趣的問題，約翰。我還沒想過這件事。我們有一個電子部門，下轄三個垂直部門。隨著我們對投資者進行更多關於電子業務的教育，我們實際上試圖進一步細分它，以明確我們在前端擁有什麼，我們在後端擁有什麼，我們在電路中擁有什麼以及我們在組裝中擁有什麼。

Within circuitry, there's even a bifurcation in that market as we just went through with the higher-end IC substrate market and server board market versus some of the legacy markets. So I think, if anything, we'll be providing more clarity around what we do within our verticals rather than less. And I don't see any desire to resegment.

在電路領域，該市場甚至出現了分叉，因為我們剛剛經歷了高端IC載板市場和伺服器主機板市場以及一些傳統市場。因此我認為，如果有的話，我們將更加清楚地說明我們在垂直領域所做的事情，而不是更少。我沒有看到任何重新劃分的願望。

Okay. And then secondly, you've been comfortable running with a lot higher leverage in the past. Do you have a time frame in mind to how long you'll run with relatively low leverage?

好的。其次，您過去一直習慣於使用更高的槓桿。您是否有一個時間框架，決定以相對較低的槓桿運行多長時間？

We've always been opportunistic with regard to capital allocation. It will be -- I would say that we have no -- our capacity doesn't burn a hole in our pocket. We have no desire to rush to deploy capital. We're going to be very thoughtful and prudent about -- with regard to capital deployment from here, and it will depend on what opportunities are available.

我們在資本配置方面始終抱持投機取巧的態度。我想說的是，我們沒有能力，我們不會花光我們的錢。我們無意倉促部署資本。從現在起，我們將非常謹慎地考慮資本部署，這將取決於有哪些可用的機會。

And while we have a leverage -- targeted leverage ceiling of 3.5 times, that doesn't mean we want to run the business there. So we're very comfortable with our balance sheet as it is today and the flexibility it provides to us.

雖然我們的槓桿率目標上限是 3.5 倍，但這並不意味著我們想在那裡開展業務。因此，我們對目前的資產負債表以及它為我們提供的靈活性感到非常滿意。

Jon Tanwanteng, CJS Securities.

Jon Tanwanteng，CJS 證券。

Just one question for me. One of your larger legacy EV customers is experiencing significantly weaker sales entering the year. Are you factoring that into your EV expectations? And do you expect growth in those end markets on a net basis considering that one large customer?

我只想問一個問題。您的一家大型傳統電動車客戶今年的銷售情況明顯不佳。您是否已將此因素考慮進您的電動車預期中？考慮到一個大客戶，您是否預期這些終端市場淨值會成長？

Yes. So our power electronics business, Jon, which I think is what you're referring to, has done a very good job of winning new business with both Western electric vehicle OEMs and emerging Chinese electric vehicle OEMs. The electric vehicle market continues to grow. And so our power electronics business should continue to grow nicely in 2025.

是的。所以，喬恩，我想這就是你所指的我們的電力電子業務，在贏得西方電動汽車原始設備製造商和新興中國電動汽車原始設備製造商的新業務方面做得非常出色。電動車市場持續成長。因此，我們的電力電子業務在 2025 年應該會繼續良好成長。

The units that could potentially be lost by any one customer are being absorbed by others as we see it. And so I think our guidance holds in light of whatever dynamics it is that you're specifically referring to. Got it, thank you very much.

我們看到，任何一個客戶可能損失的單位正被其他客戶吸收。因此我認為，無論你具體提到的是何種動態，我們的指導都是成立的。明白了，非常感謝。

Thanks sir.

謝謝先生。

Steve Byrne, Bank of America.

美國銀行的史蒂夫伯恩。

This is Rock Hoffman on for Steve Byrne. Could you speak about Kuprion a bit more and when you expect Kuprion's copper paste to become a more commercial product?

這是由羅克霍夫曼代替史蒂夫伯恩表演的。您能否再多談談 Kuprion 以及您預計 Kuprion 的銅膏何時會成為更具商業化的產品？

Yes. So as you would have seen in our slides and how we're defining success in 2025, continuing to gain traction commercially and improve our supply chain capability for these emerging technologies, Kuprion chief amongst them is one of the criteria for success in 2025.

是的。因此，正如您在我們的幻燈片中看到的，我們如何定義 2025 年的成功，繼續在商業上獲得吸引力並提高我們針對這些新興技術的供應鏈能力，其中 Kuprion 是 2025 年成功的標準之一。

The commercialization effort around ActiveCopper, which is a product that Kuprion makes has been exceptional and customer demand is through the roof and the number of applications, projects we're working on continues to grow and the product is performing. Our energy over the past couple of quarters and for the next several quarters is on supply chain.

Kuprion 公司生產的產品 ActiveCopper 的商業化努力非常出色，客戶需求不斷增長，我們正在開發的應用程式和專案的數量也在持續增長，產品的性能也非常出色。過去幾個季度以及未來幾個季度，我們的精力都集中在供應鏈上。

So that's building our capacity for ActiveCopper production and supporting our customers for developing their applications know-how and process for high-volume manufacturing using ActiveCopper. And that is moving along reasonably well. I expect to have reasonable revenue in 2025 and EBITDA contribution in 2026, which has always been our indicative time line for active copper. That's unchanged. And our confidence in the viability of ActiveCopper as a product and the performance and the market pull grows every quarter.

因此，這將增強我們的 ActiveCopper 生產能力，並支援我們的客戶開發使用 ActiveCopper 進行大量生產的應用知識和流程。而且一切進展順利。我預期 2025 年的收入會比較合理，2026 年的 EBITDA 貢獻也會比較大，這一直是我們活躍銅礦的指示性時間表。這一點沒有變化。我們對 ActiveCopper 產品的可行性、效能和市場吸引力的信心每季都在成長。

Thanks. And as a follow-up, have metallized surfaces within auto parts and household products gained share? Or is there a shift to other surface types?

謝謝。另外，汽車零件和家用產品的金屬化表面的份額是否增加了？或是否轉向其他表面類型？

Yes, it's a great question, right? So in our Industrial Solutions business, we sell functional and decorative surface treatment, right? So functional as anticorrosion and protective materials that improve performance and decorative is a thin film of nickel on a piece of plastic for an automotive application, whether that's the grill or hood ornament of a car or also, as you said, sanitary like sinks and faucets.

是的，這是一個很好的問題，對吧？那麼在我們的工業解決方案業務中，我們銷售功能性和裝飾性表面處理，對嗎？因此，在汽車應用的塑膠片上鍍上一層薄薄的鎳膜，可以作為防腐和保護材料，提高性能和裝飾性，無論是汽車的格柵或引擎蓋裝飾，還是如您所說，像水槽和水龍頭這樣的衛生用品。

There's been a trend over the past couple of years away from that metal finish towards painted finish in automotive, right? And so you're seeing more black painted grills as opposed to chrome-looking grills on the road.

過去幾年來，汽車飾面逐漸從金屬飾面轉向噴漆飾面，對嗎？因此，在路上，你看到的更多的是黑色塗漆的格柵，而不是鍍鉻的格柵。

We're actually seeing that change though. And so when you look at our results in 2024, for example, our anticorrosion business did quite well, and our decorative business was a bit softer because of that fashion trend changing. When you talk to our customers, the OEMs are saying that chrome finishes are coming back.

但我們確實看到了這種變化。因此，當您查看我們 2024 年的業績時，例如，我們的防腐業務表現相當不錯，而由於時尚趨勢的變化，我們的裝飾業務略顯疲軟。當您與我們的客戶交談時，原始設備製造商 (OEM) 表示鍍鉻飾面正在重新流行。

And so we've got several customers that are saying they're fully booked with their plating lines in 2026 after a pretty weak year in 2024. And so we see that trend reversing, and that's a tailwind for us over the next couple of years. I'm not sure how material it will be in 2025, but over the next couple of years, that trend reversing will support the business and growth in the industrial business.

因此，我們有幾位客戶表示，在 2024 年相當疲軟之後，他們的 2026 年電鍍生產線已經全部預訂滿。因此，我們看到這種趨勢正在逆轉，這對我們未來幾年來說是一個順風。我不確定 2025 年它會有多大影響，但在接下來的幾年裡，這種趨勢的逆轉將支持工業業務的業務和成長。

Pete Osterland, Truist Securities.

皮特‧奧斯特蘭 (Pete Osterland)，Truist 證券公司。

Hey, good morning. Thanks for taking the questions. So first, I just wanted to ask on your expectations for margin expansion this year. Are you expecting mix to continue to drive growth? And is there anything else noteworthy you're seeing at this point, whether on input costs or any potential for self-help through cost improvements?

嘿，早安。感謝您回答這些問題。首先，我想問一下您對今年利潤率成長的預期。您是否預計混合將繼續推動成長？目前您是否還看到其他值得注意的事情，無論是投入成本還是透過改進成本來實現自救的潛力？

Yes. So mix should continue to help. There's been some ongoing raw material deflation that should continue to help, and we're always working on productivity, facility rationalization activities. And so that's another lever that we have. I wouldn't count on another 120 basis points of margin expansion ex metal in 2025, but we should continue to see margin expansion over the course of the year. And that's also not including any real benefit from facility utilization improvement driven by materially higher volumes in the industrial business.

是的。因此混合應該會繼續有幫助。持續的原料通貨緊縮應該會繼續有所幫助，我們也一直致力於提高生產力和設施合理化活動。這是我們的另一個槓桿。我不會指望 2025 年金屬以外的利潤率會再擴大 120 個基點，但我們應該會在今年繼續看到利潤率擴大。而這還不包括由於工業業務量大幅增加而帶來的設施利用率改善所帶來的實際利益。

Got it, thanks. And then just as a follow-up, you called out that CapEx was higher than historically average in '24, and you're guiding for it to be about the same for 2025. So just was wondering if you could give some color on the capital projects you're prioritizing for the upcoming year and how they tie your longer-term plans for growth. Thank you.

明白了，謝謝。然後作為後續問題，您提到 24 年的資本支出高於歷史平均水平，並且您預計 2025 年的資本支出將大致相同。所以我想知道您是否可以介紹一下您在來年優先考慮的資本項目，以及它們如何與您的長期成長計劃聯繫起來。謝謝。

Yes. So as Carey said, we were pleased to have the ability to invest as much as we did in 2024. There were some big projects. Most notably, we doubled our capacity for Argomax, which is our sintered silver material used in power electronics. We're building a large research center in India, which is nearing completion. And we had some IT projects that pushed that number a bit higher in 2024.

是的。因此正如 Carey 所說，我們很高興能夠在 2024 年進行如此多的投資。有一些大項目。最值得注意的是，我們將 Argomax 的產能提高了一倍，Argomax 是我們用於電力電子的燒結銀材料。我們正在印度建造一個大型研究中心，目前已接近完工。我們的一些 IT 專案將在 2024 年將這一數字推高一些。

As we look to 2025, the biggest project I'd point out is that Kuprion project that we just talked about. But there are several other -- we consider them substantial. For us, substantial is $10 million to $15 million of investment that we're working on to support longer-term growth in these high-value niches that we've been penetrating. But the long-term run rate is still around 2% of sales, even if we're a tick higher for a couple of years here.

展望 2025 年，我想指出的最大項目就是我們剛才談到的 Kuprion 計畫。但還有其他幾個——我們認為它們很重要。對我們來說，我們正在進行的金額可觀的投資是1000萬到1500萬美元，用於支持我們已經進入的這些高價值領域的長期成長。但即使這幾年我們的營業額略有增加，長期營業額仍在銷售額的 2% 左右。

Yes. And Pete, I would just add to that. The other thing that's been ticking up and that we're excited about is investing in customers' equipment and funding that for our customers to win longer-term lock-in contracts. So that trend is moving positively, and we want to see that keep going.

是的。皮特，我只是想補充一點。另一件讓我們感到興奮的事情是投資客戶的設備和資金，幫助我們的客戶贏得更長期的鎖定合約。所以這個趨勢是積極的，我們希望看到它繼續下去。

It's another way we support our customers' growth is by helping them finance expansion projects in exchange for long-term contracts at high value -- of high-value products. Those are high-returning projects that we can do.

我們支持客戶成長的另一種方式是幫助他們融資擴張項目，以換取高價值產品的長期合約。這些都是我們可以做的高回報項目。

David Silver, CL King.

大衛·西爾弗、CL·金。

Yeah, hi, good morning,I had a question, I guess, about your R&D spend. So year-over-year, if you exclude, I guess, the Kuprion charge, your R&D spend is up more than, I don't know, 20%, 25%. I was wondering if maybe you could just highlight some of the areas where you're putting resources to work there? And then should we be penciling in kind of a growth rate to that line that's somewhat above your top line growth?Thank you.

是的，早上好，我猜我有一個關於您的研發支出的問題。因此，與去年同期相比，如果你排除 Kuprion 的費用，你的研發支出將增加超過，我不知道，20% 還是 25%。我想知道您是否可以強調您投入資源的一些領域？那麼，我們是否應該將某種成長率計算到略高於您的營收成長率的水平？謝謝。

Thanks, David. So just to clarify one point, there is some Kuprion spend in 2024 as well. It's not as significant, obviously, as a 2023 number where we made the initial purchase price, but there is, I think, about $4 million in the 2024 number. So when you make those adjustments, I think that we are seeing R&D tick up slightly as a percentage of sales.

謝謝，大衛。因此，只需澄清一點，2024 年也有一些 Kuprion 支出。顯然，它不像我們最初確定的 2023 年數字那麼重要，但我認為 2024 年的數字約為 400 萬美元。因此，當你做出這些調整時，我認為我們會看到研發佔銷售額的百分比略有上升。

As Ben mentioned and I mentioned in the prepared remarks, we've been making some investments in labs. We're working on a new integrated R&D lab in India. Those -- where people being added to those facilities, and we're seeing some increase in costs. That's most of our R&D cost is people, people and leases.

正如本和我在準備好的發言中提到的，我們一直在對實驗室進行一些投資。我們正在印度建立一個新的綜合研發實驗室。這些設施中增加了人員，我們看到成本增加。我們的研發成本大多是人力、人員和租賃。

As an overall trend, though, I don't expect that to tick up more than inflation or sales growth as we go forward. I think it's important to note when we look at our R&D expense that we -- even though on GAAP, it's reported at these levels, we really think about our development and our technical service spend, which shows up in S&T as part of our broader R&D spend. And so when you put those two numbers together, you see a couple of percentage points higher R&D, and that's really how we look at the spend, and we think it's sufficient for the business we have.

不過，從整體趨勢來看，我預期這一趨勢不會比通膨或銷售成長更快。我認為，當我們審視我們的研發費用時，值得注意的是——儘管按照 GAAP 報告的是這些水平，但我們真正考慮的是我們的開發和技術服務支出，這些支出在 S&T 中顯示為我們更廣泛的研發支出的一部分。因此，當你把這兩個數字放在一起時，你會看到研發支出高出了幾個百分點，這就是我們對支出的看法，我們認為這對我們現有的業務來說已經足夠了。

Yes. As Carey rightly points out, our technical service folks and our application centers are also a critical part of product development where we're doing local customization to meet local customer needs, and they aren't captured in R&D. The other general point I'd make is that with the Graphics business leaving the envelope, we will have a slightly higher R&D percent of sales because the graphics business was less R&D intensive than our other businesses. So that's a modest change. But R&D intensity for this -- our R&D investment for our businesses has been more than adequate to support outsized growth for the future.

是的。正如 Carey 正確指出的那樣，我們的技術服務人員和應用中心也是產品開發的重要組成部分，我們會進行本地客製化以滿足本地客戶的需求，而這些需求並沒有被納入研發範圍。我要說的另一個總體觀點是，隨著圖形業務的突破，我們的銷售額中研發支出的百分比將略高，因為圖形業務的研發密集程度低於我們的其他業務。所以這是一個適度的改變。但就研發強度而言－我們對業務的研發投資足以支持未來的超額成長。

Okay. Great. And then one last one for me. But you have made some scattered comments about your business in China. And when I think about the amount of business you do there, and I'm thinking there's some tariff issues. There's -- I think there's some currency issues there and then, I don't know, the AI issues.

好的。偉大的。對我來說還有最後一個。但您對您在中國的業務發表了一些零散的評論。當我考慮到你們在那裡開展的業務量時，我就想到了存在一些關稅問題。我認為那裡存在一些貨幣問題，還有人工智慧問題。

But broadly speaking, could you just maybe speak about how you're thinking about your China business for 2025? So the economic activity there and maybe some currency or other issues that factor into your planning for the full year there? Thank you.

但從總體上講，您能否談談您對 2025 年中國業務的看法？那麼那裡的經濟活動以及一些貨幣或其他問題會如何影響您對那裡全年的規劃？謝謝。

Yes, absolutely. So we had a good year in 2024 in China. Revenue was up in the low teens. A lot of that was driven by the export market. Some of that was driven by the local Chinese smartphone market and then the Chinese automotive market was healthy. Our business in China is a local business. We buy products, manufacture and sell locally. And so tariffs don't impact our P&L directly.

是的，絕對是如此。因此，2024年我們在中國度過了美好的一年。收入成長了百分之十幾。其中很大一部分是由出口市場推動的。其中部分原因是受到中國本土智慧型手機市場的推動，而且中國汽車市場也表現健康。我們在中國的業務是本地業務。我們在當地購買產品、製造並銷售。因此關稅不會直接影響我們的損益。

Where there's risk is, should there be an acceleration in tariffs. Our customers and our customers' customers might see demand suffer because of inflation associated with tariffs. But as we see our business in China, we see the trends in 2024 continuing. That electric vehicle market is seeing significant growth. We're penetrating it nicely.

哪裡有風險，就是否應該加速提高關稅。我們的客戶以及客戶的客戶可能會因為關稅相關的通貨膨脹而面臨需求受損的情況。但從我們在中國的業務來看，我們看到 2024 年的趨勢將持續下去。電動車市場正在顯著成長。我們正在順利地滲透。

The high-end EVs are adopting our technology, and all of that is a tailwind for earnings as we look into 2025. At the same time, supply chains are diversifying outside of China. Both multinational corporations and Chinese companies are building capacity for manufacturing in Indonesia and Thailand and Vietnam.

高端電動車正在採用我們的技術，展望 2025 年，所有這些都將為我們帶來有利可圖的順風。同時，供應鏈正在中國以外實現多元化。跨國公司和中國企業都在印尼、泰國和越南建設製造業產能。

We're seeing a lot of activity in India. And those are markets where we already have an on-the-ground presence with commercial people, with technical people and can welcome our customers into those markets. They're higher-margin markets for us. And so we're seeing quite a bit of growth there.

我們看到印度有很多活動。在這些市場上，我們已經擁有實地業務，有商業人員和技術人員，可以歡迎我們的客戶進入這些市場。對我們來說，它們是利潤較高的市場。因此我們看到那裡有相當大的增長。

And that's a trend that we don't see tailing off, and we view that as a significant market share opportunity. And so China was a good story for us in 2024. We expect it to be a growth vector in 2025. At the same time, geopolitics are driving share and value our way over the longer term.

我們認為這一趨勢不會減弱，並且這是一個重要的市場份額機會。因此，2024 年中國市場對我們來說是一個好兆頭。我們預計中國市場將成為 2025 年的成長動力。同時，從長遠來看，地緣政治正在推動我們的份額和價值成長。

Duffy Fischer, Goldman Sachs.

高盛的達菲費雪 (Duffy Fischer)。

Just on the graphics, the $30 million over 10 months, that's $3 million a month, is it that smooth? Or is there seasonality in that? And then does that mean there's roughly $6 million hit next year as well?

光從圖形上看，10 個月賺 3,000 萬美元，也就是每月 300 萬美元，這麼順利嗎？或者說這其中有季節性嗎？那麼這是否意味著明年也會有約 600 萬美元的損失？

Yes. The Graphics business is not flat line across the year. I would say count on somewhere between $3 million to $5 million of contribution in the first quarter towards our first quarter guide, and that will fall out next year, presumably. Yes.

是的。圖形業務在全年中並不是持平的。我想說，第一季我們的第一季指南貢獻金額預計在 300 萬到 500 萬美元之間，大概會在明年實現。是的。

Okay. And then how are you guys thinking about the buyback? Is it opportunistic where if some of the M&A doesn't come to fruition, this is plan B? Or do you want to do something more systemic and more even with the buyback? So just -- I mean, in our model, roughly, how should we think about share count and buybacks?

好的。那你們對於回購有什麼看法呢？這是否是一種機會主義的做法，即如果部分併購未能實現，那麼這就是 B 計劃？還是你想對回購採取更有系統、更均衡的措施？所以——我的意思是，在我們的模型中，大致來說，我們應該如何考慮股票數量和回購？

Yes, we'll see what the market serves up to us. We've never been formulaic with our approach to buyback, and I don't expect that to change imminently. We still don't have the proceeds from the graphic sale yet. So it feels early to address that. But I think it's reasonable to expect us to be interested in repurchase in 2025.

是的，我們會看看市場能為我們提供什麼。我們的回購方式從來都不是公式化的，而且我預計這種情況不會很快改變。我們還沒有收到圖形銷售的收益。所以現在談論這個問題還為時過早。但我認為，我們有理由預期 2025 年會有意回購。

I will now turn the call back over to Ben Gliklich for closing remarks.

現在我將電話轉回給 Ben Gliklich，請他作最後發言。

All right. Thank you very much, Rebecca. Thanks, everybody, for joining. We look forward to seeing many of you in the weeks and months to come on the road. Have a good day.

好的。非常感謝，麗貝卡。感謝大家的加入。我們期待在未來的幾週和幾個月裡在路上見到你們。祝你有美好的一天。

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

女士們、先生們，今天的電話會議到此結束。感謝大家的加入。您現在可以斷開連線。