Fortune Brands Innovations Inc (FBIN) 2024 Q1 法說會逐字稿

Good afternoon. My name is Marianne. I'll be your conference operator today. At this time, I would like to welcome everyone to the Fortune Brands First Quarter 2024 Earnings Conference Call. (Operator Instructions). After the speakers' remarks, there will be a question-and-answer session. I would now like to turn the call over to Leigh Avsec, Vice President of Investor Relations and Corporate Affairs. You may begin the conference call.

午安.我叫瑪麗安。今天我將擔任你們的會議操作員。在此，我歡迎大家參加財富品牌2024年第一季財報電話會議。 （操作員說明）。演講者發言後，將進行問答環節。我現在想將電話轉給投資者關係和公司事務副總裁 Leigh Avsec。您可以開始電話會議。

Good afternoon, everyone, and welcome to the Fortune Brands Innovations First Quarter Earnings Call. Hopefully, everyone has had a chance to review the earnings release. The earnings release and the audio replay of this call can be found on the Investors section of our fbin.com website.

大家下午好，歡迎參加財富品牌創新第一季財報電話會議。希望每個人都有機會查看收益發布。收益發布和本次電話會議的音訊重播可以在我們的 fbin.com 網站的投資者部分找到。

I want to remind everyone that the forward-looking statements we make on the call today, either in our prepared remarks or in the associated question-and-answer session, are based on current expectations and market outlook and are subject to certain risks and uncertainties that may cause actual results to differ materially from those currently anticipated. These risks are detailed in our various filings with the SEC. The company does not undertake any obligation to update or revise any forward-looking statements, except as may be required by law. Any references to operating profit or margin, earnings per share or free cash flow on today's call will focus on our results on a before charges and gains basis unless otherwise specified. Please visit our website for reconciliations.

我想提醒大家，我們今天在電話會議上所做的前瞻性陳述，無論是在我們準備好的發言中還是在相關的問答環節中，都是基於當前的預期和市場前景，並受到一定的風險和不確定性的影響這可能會導致實際結果與當前預期有重大差異。這些風險在我們向 SEC 提交的各種文件中有詳細說明。除法律要求外，本公司不承擔更新或修改任何前瞻性聲明的義務。除非另有說明，今天電話會議中任何提及營業利潤或利潤率、每股收益或自由現金流的內容都將重點關注我們在費用和收益之前的業績。請造訪我們的網站進行調節。

With me on the call today are Nick Fink, our Chief Executive Officer; and Dave Barry, our Chief Financial Officer. Following our prepared remarks, we have a lot of time to address some questions.

今天與我一起參加電話會議的是我們的執行長 Nick Fink；以及我們的財務長戴夫·巴里 (Dave Barry)。在我們準備好的發言之後，我們有許多時間來回答一些問題。

I will now turn the call over to Nick. Nick?

我現在將把電話轉給尼克。缺口？

Thank you, Leigh, and thank you to everyone for joining us today. On this call, I will walk through the highlights of our first quarter performance, give some color on the drivers of this performance, including progress on our strategic initiatives and offer some thoughts on the macro environment. I will then turn the call over to Dave for a discussion of our financial results, including how we are thinking about the remainder of 2024.

謝謝你，Leigh，也謝謝大家今天加入我們。在這次電話會議上，我將介紹我們第一季業績的亮點，對這一業績的驅動因素進行一些闡述，包括我們的策略舉措的進展，並對宏觀環境提出一些想法。然後我會將電話轉給戴夫，討論我們的財務業績，包括我們如何考慮 2024 年剩餘時間。

Our teams delivered strong first quarter results by executing on our priorities, including delivering above-market growth and operating margin improvements. We saw powerful proof points of our compelling investment thesis this past quarter and are increasingly seeing the benefit of the transformative actions we took over the past few years. These actions all support our strategy as a growth-focused company, powered by secular tailwinds, underpinned by leading brands, innovation and channel management and fueled by our Fortune Brands Advantage capabilities in our newly aligned structure.

我們的團隊透過執行我們的優先事項，包括實現高於市場的成長和營業利潤率的提高，取得了強勁的第一季業績。上個季度，我們看到了令人信服的投資論點的有力證據，並且越來越多地看到我們過去幾年採取的變革行動的好處。這些行動都支持我們作為一家以成長為重點的公司的策略，以長期順風為動力，以領先品牌、創新和通路管理為基礎，並以我們新調整的結構中的財富品牌優勢能力為推動力。

Turning to our first quarter performance. Our teams delivered strong top and bottom line results, driving both sales and margins as they executed on our priorities. Through our strategy of growing the core and accelerating digital products, we were able to focus on those opportunities with the highest potential for returns, including in our leading brands, digital and connected capabilities and products and our meaningful innovation while also optimizing and aligning our operations.

轉向我們第一季的業績。我們的團隊在執行我們的優先事項時取得了強勁的收入和利潤，推動了銷售和利潤。透過我們發展核心和加速數位產品的策略，我們能夠專注於那些具有最高回報潛力的機會，包括我們的領先品牌、數位和互聯能力和產品以及我們有意義的創新，同時優化和調整我們的營運。

Looking forward to the remainder of the year, we continue to expect to achieve the full year guidance we initially outlined during our fourth quarter call. Net sales of $1.1 billion were up 7%, while organic sales were down 3% versus the prior year's first quarter. We estimate that our POS performance outperformed the larger market for our products by over 100 basis points, reflecting our commitment to focus on the highest growth opportunities. Operating income increased 22%, and our operating margin was 200 basis points higher than the first quarter of 2023. Our results are a great testament to the ability of our newly aligned organization to unlock value.

展望今年剩餘時間，我們繼續期望實現我們在第四季度電話會議中最初概述的全年指引。淨銷售額為 11 億美元，成長 7%，而有機銷售額與去年第一季相比下降 3%。我們估計，我們的 POS 業績比我們產品的更大市場高出 100 個基點以上，這反映了我們致力於關注最高成長機會的承諾。營業收入成長了 22%，營業利潤率比 2023 年第一季高出 200 個基點。

Our sales and margin performance generated earnings per share of $0.83 in the first quarter, a 20% increase over the first quarter of 2023. As we have previously highlighted, the Fortune Brands operating model is designed to accelerate our leadership in brand and innovation while also creating value for our channel partners. We are now designed to operate more efficiently and are focused on investing those efficiencies and opportunities with the highest potential for returns.

我們第一季的銷售額和利潤率業績實現每股收益0.83 美元，比2023 年第一季成長20%。 ，同時也為我們的通路夥伴創造價值。我們現在旨在提高營運效率，並專注於投資那些具有最高回報潛力的效率和機會。

Most importantly, our new structure is a catalyst for accelerated growth. This past quarter, we had some compelling proof points of the power of our new structure as we further sharpened our focus on brands, innovation and channel leadership. We saw a particular acceleration in our Smart Water Network and are achieving many of our milestones well ahead of schedule.

最重要的是，我們的新結構是加速成長的催化劑。上個季度，隨著我們進一步加強對品牌、創新和通路領導的關注，我們有一些令人信服的證據證明了新結構的力量。我們的智慧水網路取得了特別的加速，並提前實現了許多里程碑。

In [perseverance] of our whole home water management strategy, we announced our acquisition of SpringWell, which provides residential whole home water filtration and water softening solutions via direct-to-consumer channels. The addition of SpringWell paves the way for Fortune Brands to invest and capture opportunities in the approximately $4 billion U.S. residential water filtration and water quality market.

為了堅持我們的全屋水管理策略，我們宣布收購 SpringWell，後者透過直接面向消費者的管道提供住宅全屋水過濾和水軟化解決方案。 SpringWell 的加入為 Fortune Brands 投資並抓住價值約 40 億美元的美國住宅水過濾和水質市場的機會鋪平了道路。

We expect this acquisition to increase Fortune Brands exposure to recurring revenue streams. SpringWell with digital and direct marketing expertise augments Fortune Brands existing digital capabilities. It is proving to be highly synergistic with our Flo leak detection system with a double-digit attachment rate since flow has been available on the SpringWell site. Consistent with our M&A priorities, the strategic discipline deal will not only augment our product portfolio but has the potential to accelerate our capabilities as we look to integrate their expertise across our businesses.

我們預計此次收購將增加 Fortune Brands 的經常性收入來源。 SpringWell 擁有數位和直接行銷專業知識，增強了 Fortune Brands 現有的數位能力。事實證明，它與我們的 Flo 洩漏檢測系統具有高度協同作用，具有兩位數的附著率，因為 SpringWell 網站上已經提供了流量。與我們的併購優先事項一致，策略紀律交易不僅將擴大我們的產品組合，而且有可能提高我們的能力，因為我們希望將他們的專業知識整合到我們的業務中。

Our brands and products are increasingly being recognized for their innovation, aesthetics and ability to make the world a better place. In March, Moen was named Fast Company's 2024 list of Most Innovative Companies. This impressive honor recognizes our leadership as a pioneer in whole home water management, including our leading smart water network. Within our security business, our connected residential locks continue to receive critical acclaim, with our recent Yale Assure Lock 2 Touch being named by Forbes Magazine as the best fingerprint in key code smart lock. The innovative features of this exciting product are clearly resonating.

我們的品牌和產品因其創新、美觀和讓世界變得更美好的能力而日益受到認可。 3 月，摩恩被 Fast Company 評為 2024 年最具創新力公司名單。這項令人印象深刻的榮譽認可了我們作為整個家庭水管理（包括我們領先的智慧水網絡）領域先驅的領導地位。在我們的安全業務中，我們的連網住宅鎖繼續受到好評，我們最近的 Yale Assure Lock 2 Touch 被《福布斯》雜誌評為鍵碼智慧鎖中最佳指紋鎖。這款令人興奮的產品的創新功能顯然引起了共鳴。

Finally, our Fiberon Wildwood composite cladding was recognized by Green Builder Media as a sustainable product of the year. Whether it's saving water, protecting people or incorporating recycled inputs, our brands are highlighting how company can have success and benefit people, communities and the planet.

最後，我們的 Fiberon Wildwood 複合材料包層被 Green Builder Media 評為年度永續產品。無論是節約用水、保護人類或納入回收投入，我們的品牌都在強調公司如何取得成功並造福人類、社區和地球。

Our brands and teams are working together to delight consumers with our innovative and beautiful products and our increasingly cohesive and integrated portfolio was in display at the recent industry shows in Las Vegas in February.

我們的品牌和團隊正在共同努力，以我們創新而精美的產品取悅消費者，我們日益凝聚和整合的產品組合在二月份在拉斯維加斯舉行的最近的行業展會上得到了展示。

Our House of Rohl Booth displayed our comprehensive suite of luxury fixtures and provided clear intangible evidence of how seamlessly our existing House of Rohl brands integrate with our newly acquired Emtek and Schaub brands. Our message of curated luxury clearly resonated and House of Rohl was awarded the Best Booth Large Booth of KBIS. And for the first time, Therma-Tru, LARSON, Fiberon, Fypon and Solar Innovations were all on display together in a cohesive booth that showcased our material science expertise and product innovations working together.

我們的 House of Rohl 展位展示了我們全套的豪華裝置，並提供了清晰的無形證據，證明我們現有的 House of Rohl 品牌與我們新收購的 Emtek 和 Schaub 品牌如何無縫融合。我們精心策劃的奢華概念引起了強烈共鳴，House of Rohl 被授予 KBIS 最佳展位大展位。 Therma-Tru、LARSON、Fiberon、Fypon 和 Solar Innovations 首次在一個有凝聚力的展位上一起展出，展示了我們的材料科學專業知識和產品創新的協同作用。

Turning to our digital portfolio. We saw over 200,000 device activations in the first quarter, and the overall digital business continues to accelerate. Our connected water business was particularly strong. In the first quarter alone, we added 15,000 users of Flo, and our POS performance exceeded our expectations. And in the quarter, our retail and e-commerce POS performance for Flo grew by 85% versus the first quarter of 2023.

轉向我們的數位產品組合。第一季我們看到超過 200,000 台設備激活，整體數位業務持續加速。我們的互聯水務業務尤其強勁。僅第一季度，我們就增加了 15,000 名 Flo 用戶，我們的 POS 效能超出了我們的預期。在本季度，我們 Flo 的零售和電子商務 POS 業績較 2023 年第一季成長了 85%。

As you may recall, last fall, we formed a new connected products group by combining the original Fortune Brands team with the Yale and August team into a single powerhouse organization under aligned leadership. This group of about 200 engineers is performing very well and delivering milestones ahead of schedule as we leverage our combined insights and talent across the entire portfolio with increasing speed and efficiency.

您可能還記得，去年秋天，我們將原來的 Fortune Brands 團隊與耶魯大學和 August 團隊合併為一個統一領導下的強大組織，從而組建了一個新的互聯產品團隊。這支由約 200 名工程師組成的團隊表現非常出色，並提前實現了里程碑，因為我們在整個產品組合中充分利用了我們的綜合見解和人才，速度和效率不斷提高。

Our results this quarter and some of the exciting developments, we are seeing, give me full confidence in Fortune Brands innovations' ability to deliver long-term growth and sustained value creation through the cycle, and we remain committed to achieving our long-term goals.

我們本季的業績以及我們所看到的一些令人興奮的發展讓我對 Fortune Brands 創新在整個週期中實現長期增長和持續價值創造的能力充滿信心，並且我們將繼續致力於實現我們的長期目標。

Turning now to some additional thoughts on the current housing market and the market for our products. Looking at the overall market and consistent with what we anticipated in our fourth quarter call, we saw continued softness in the R&R market, while we also saw encouraging POS growth in our products, which serve the single-family new construction channel, including Moen and Therma-Tru. The need and desire for homes remains incredibly strong, and our products are optimally positioned in the context of the larger macro environment.

現在談談對當前房地產市場和我們產品市場的一些額外想法。縱觀整體市場，與我們在第四季度電話會議中的預期一致，我們看到R&R 市場持續疲軟，同時我們也看到我們產品的POS 增長令人鼓舞，這些產品服務於單戶新建渠道，包括摩恩和Therma-Tru。對住宅的需求和渴望仍然非常強烈，我們的產品在更大的宏觀環境中得到了最佳定位。

Earlier this quarter, and with a more stable interest rate environment, we saw an uptick of buyers in the market, although activity slowed as interest rates increased in the face of persistent inflation. As the progress of the quarter demonstrated, consumers remain sensitive to rate fluctuations, but the need for an interest in housing remains strong.

本季度初，在利率環境更加穩定的情況下，我們看到市場上的買家增加，儘管由於持續的通貨膨脹導致利率上升，活動有所放緩。正如本季的進展所表明的那樣，消費者對利率波動仍然敏感，但對住房興趣的需求仍然強勁。

The U.S. continues to be massively underbuilt. Housing prices and home equity levels continue to remain high. Demographic factors and high personal income levels continue to support housing demand, while housing stock remains extremely constrained. At the same time, the stock of existing homes that are currently available for sale remains far below pre-pandemic norms and home values increased faster in March of 2024 versus March of 2023.

美國的建設仍然嚴重不足。房價和房屋淨值水準持續維持在高位。人口因素和高個人收入水準繼續支撐住房需求，但住房存量仍極為有限。同時，目前可供出售的現有房屋存量仍遠低於大流行前的標準，並且 2024 年 3 月的房屋價值比 2023 年 3 月增長更快。

Turning to new construction, single-family new construction permit activity in starts was strong in the first quarter of 2024 where completions continue to lag. Over the last few months, mortgage applications increased in response to stabilized mortgage rates and the expectation of interest rate cuts. While it appears interest rates will remain higher for slightly longer, the market continues to remain massively underbuilt and pent-up demand is only being exacerbated.

談到新建築，2024 年第一季單戶新建築許可證開工活動強勁，但竣工量持續落後。過去幾個月，由於抵押貸款利率穩定和降息預期，抵押貸款申請有所增加。儘管利率似乎將在稍長的時間內保持在較高水平，但市場仍然嚴重不足，被壓抑的需求只會進一步加劇。

In addition, large production builders remain optimally positioned to continue to be able to address the need for housing. And we are a trusted partner to a very significant number of these large home builders. Importantly, because our products are incorporated closer to completion than starts, our products are experiencing the tailwinds from the uptick in housing that began in the second half of 2023, and we expect this tailwind to remain robust.

此外，大型生產建築商仍處於最佳位置，能夠繼續滿足住房需求。我們是許多大型住宅建築商值得信賴的合作夥伴。重要的是，由於我們的產品比開工更接近完工，我們的產品正經歷 2023 年下半年開始的住房上漲帶來的順風車，我們預計這種順風車將保持強勁。

Turning to R&R. We expect the R&R market to remain dynamic throughout 2024, and there are many variables that are impacting the repair and remodel space, including consumer savings and confidence, employment levels, home equity levels and existing home turnover. We continue to expect R&R market for our products to be down 2% to 4% in 2024.

轉向 R&R。我們預計 R&R 市場將在 2024 年保持活力，並且有許多變數會影響維修和改造空間，包括消費者儲蓄和信心、就業水準、房屋淨值水準和現有房屋營業額。我們仍預期 2024 年我們產品的 R&R 市場將下降 2% 至 4%。

However, the combination of high home equity levels, the low supply of homes and aging housing stock and the fact that many homeowners are living in homes that they purchased with no mortgage or with low interest rates is causing many people to rethink their existing space.

然而，房屋淨值水平高、房屋供應量低、房屋存量老化，以及許多房主居住在沒有抵押貸款或低利率的房屋中，這些因素結合在一起，導致許多人重新考慮他們現有的空間。

Google Search shows that search terms around home renovations are up versus a year ago. While a recent third-party study of homeowners indicated 82% of respondents were planning on engaging in home renovations in the next 6 months. The same survey indicated that the most compelling attributes of products are product quality, trusted brands and attractive features. Our portfolio is optimally positioned with our leading brands, innovative features and beautifully designed products, all resonating with the needs of our core customers.

谷歌搜尋顯示，與一年前相比，有關房屋裝修的搜尋字詞有所增加。最近一項針對房主的第三方研究表明，82% 的受訪者計劃在未來 6 個月內進行房屋裝修。同一項調查表明，產品最引人注目的屬性是產品品質、值得信賴的品牌和有吸引力的功能。我們的產品組合以我們的領先品牌、創新功能和設計精美的產品為最佳定位，所有這些都與我們核心客戶的需求產生共鳴。

Finally, in China, the market continues to transition away from speculative new construction to R&R, and we have confidence in our team's ability to successfully navigate the disruption and remain focused on creating long-term value in China, including in the emerging and high-potential R&R space. We continue to believe that our China business will serve as an innovation engine for the larger business and that it offers attractive optionality for future opportunities.

最後，在中國，市場繼續從投機性新建建築向 R&R 轉型，我們相信我們的團隊有能力成功應對顛覆，並繼續專注於在中國創造長期價值，包括在新興和高端領域。我們仍然相信，我們的中國業務將成為更大業務的創新引擎，並為未來的機會提供有吸引力的選擇。

Fortune Brands is very well positioned. Our branding power, meaningful and value-added innovation and channel strength are powerful catalysts for accelerated growth in the most attractive categories. We are focused on driving outperformance in categories driven by secular growth tailwinds, our connected products, material conversion, luxury and products with sustainability and safety benefits.

Fortune Brands 的定位非常有利。我們的品牌力量、有意義的增值創新以及通路實力是最具吸引力類別加速成長的強大催化劑。我們致力於在長期成長順風、我們的連網產品、材料轉換、奢侈品以及具有永續性和安全優勢的產品等領域推動卓越表現。

Our consumers continue to reward us with growing market share and our customers continue to view us as valued partners with unique insights, category management expertise and best-in-class supply chain performance. We believe our products and brands are uniquely positioned to outperform as our results demonstrated this past quarter.

我們的消費者繼續以不斷增長的市場份額回報我們，我們的客戶繼續將我們視為具有獨特見解、品類管理專業知識和一流供應鏈績效的重要合作夥伴。正如我們上個季度的業績所證明的那樣，我們相信我們的產品和品牌具有獨特的優勢，能夠跑贏大盤。

Turning now to our individual business results. Starting with Water Innovations, this segment delivered 5% sales growth versus the prior year, with organic sales down 7% while generating 100 basis points of operating margin improvement. Sales in the U.S. largely rebounded following the inclement weather to start the year, and our Moen POS was around 100 basis points higher than our market estimate. We are also seeing single-family new construction volume coming through.

現在轉向我們個人的業務成果。從 Water Innovations 開始，該部門的銷售額與去年相比成長了 5%，有機銷售額下降了 7%，同時營業利潤率提高了 100 個基點。在年初的惡劣天氣之後，美國的銷售大幅反彈，我們的摩恩 POS 比我們的市場預期高出約 100 個基點。我們也看到單戶住宅的新建量不斷增加。

The Emtek brand continues to perform extremely well and our reputation for delivering market-leading products is being rewarded with continued share gains, including low single-digit positive POS versus a market we estimate was down mid-single digits.

Emtek 品牌繼續表現出色，我們提供市場領先產品的聲譽得到了持續的份額增長的回報，其中包括低個位數的正 POS，而我們估計市場則下降了中個位數。

Finally, our work toward integrating our brands into one comprehensive and complementary luxury portfolio is progressing very well. Including our work to update existing showrooms with our combined suite of luxury products and integrating our Emtek products into our luxury outdoor offerings.

最後，我們將我們的品牌整合為一個全面且互補的奢侈品組合的工作進展順利。包括我們用我們的豪華產品組合套件更新現有陳列室，並將我們的 Emtek 產品整合到我們的豪華戶外產品中。

As I mentioned earlier, our Flo connected leak detection product continues to gain traction with insurance companies, municipalities and consumers. We recently launched a new Flo site on our Moen website and deployed an exciting branding campaign designed to raise awareness of how our products can help solve the critical issue of residential water leaks.

正如我之前提到的，我們的 Flo 連接洩漏檢測產品繼續受到保險公司、市政當局和消費者的青睞。我們最近在摩恩網站上推出了新的 Flo 網站，並部署了令人興奮的品牌宣傳活動，旨在提高人們對我們的產品如何幫助解決住宅漏水這一關鍵問題的認識。

According to the Environmental Protection Agency, the average American family is wasting 9,400 gallons of water annually from preventable household leaks. And the resulting damage costs U.S. insurers and homeowners many billions of dollars every year. At a time in which insurance costs are rising and water scarcity is becoming even more serious, the need for a product like our n Flo Smart Water Monitor and Shutoff becoming more acute.

根據美國環保署的數據，美國家庭平均每年因可預防的家庭洩漏而浪費 9,400 加侖的水。由此造成的損失每年對美國保險公司和房主造成數十億美元的損失。在保險成本不斷上漲、水資源短缺變得更加嚴重的時期，對像我們的 n Flo 智慧水監測器和關閉裝置這樣的產品的需求變得更加迫切。

In addition to the billions of dollars, we believe our products can save insurance companies and homeowners every year. We're working to help homeowners, builders and municipalities achieve their water saving and carbon reduction goals. Our innovative connected sprinkler system recently achieved EPA WaterSense certification which significantly expands the number of rebates available to consumers across the country.

除了數十億美元之外，我們相信我們的產品每年還可以為保險公司和房主節省開支。我們正在努力幫助房主、建築商和市政當局實現其節水和碳減排目標。我們創新的連網噴水滅火系統最近獲得了 EPA WaterSense 認證，這大大增加了全國消費者可獲得的折扣數量。

Additionally, we are finalizing our partnership that we expect will greatly facilitate the number and availability of rebates for our smart water products for residents of municipalities across California, which should help further drive adoption of our products. We expect this program will officially launch this summer, and we are excited for how it can help raise awareness and adoption of home smart leak detection solutions in a location where it is greatly needed.

此外，我們正在敲定我們的合作夥伴關係，我們預計這將極大地促進我們的智慧水產品為加州各城市的居民提供回扣的數量和可用性，這將有助於進一步推動我們產品的採用。我們預計該計劃將於今年夏天正式啟動，我們很高興它能夠幫助提高人們對家庭智慧洩漏檢測解決方案的認識和在急需的地方的採用。

Looking to the remainder of 2024, we expect our Water segment to continue to execute on our commitment to deliver above-market sales performance by focusing on those parts of the market with the greatest potential for growth. We plan to continue to make thoughtful investments in our key priorities, including branding and marketing, digital and capacity.

展望 2024 年剩餘時間，我們預期水務部門將繼續履行我們的承諾，透過專注於最具成長潛力的市場部分，實現高於市場的銷售業績。我們計劃繼續對我們的關鍵優先事項進行深思熟慮的投資，包括品牌和行銷、數位和產能。

We expect our pricing actions to hold up as we continue to innovate as the benefits of our products resonate with our customers and consumers, and the promotional environment remains stable. We are on track to open 2 new facilities in the second quarter of 2024, including a new highly efficient West Coast distribution center for Moen and a state-of-the-art U.K. production facility for the House of Rohl. These targeted investments will help drive our strategy to grow the core and accelerate digital and connected products. We continue to be very excited about our water business, particularly the opportunities we see to capture growth in connected luxury and water filtration.

隨著我們產品的優勢與客戶和消費者產生共鳴，並且促銷環境保持穩定，我們預計我們的定價行為將持續下去，因為我們將繼續創新。我們預計在 2024 年第二季開設 2 個新工廠，包括為 Moen 新建的高效西海岸配送中心和為 House of Rohl 建造的最先進的英國生產設施。這些有針對性的投資將有助於推動我們發展核心並加速數位化和互聯產品的策略。我們仍然對我們的水務業務感到非常興奮，特別是我們看到的抓住互聯奢侈品和水過濾增長的機會。

Turning to Outdoors. We had a strong first quarter with an impressive 9% sales growth and operating margins that increased 680 basis points versus last year. Our performance is a direct result of the hard and strategic work of the team, and I thank them for their dedication. We are laser-focused on leveraging our expertise and investing behind our core categories and in those products, which we expect will offer the most attractive growth opportunities. Outdoor brands delivered low double-digit sales growth as tailwinds from new construction and recent product launches drove growth.

轉向戶外。我們第一季的業績表現強勁，銷售額成長了 9%，營業利潤率比去年增加了 680 個基點。我們的業績是團隊辛勤和策略性工作的直接結果，我感謝他們的奉獻精神。我們專注於利用我們的專業知識並投資於我們的核心類別和這些產品，我們預計這些產品將提供最具吸引力的成長機會。由於新建建築和近期產品推出的推動推動了成長，戶外品牌的銷售額實現了兩位數的低成長。

Therma-Tru is seeing the benefit of the increase in starts and completions, which began last year. As we previewed this past quarter at the International Builder Show, Larson is introducing some innovative and on-trend new products at key price points. Additionally, we will continue to roll out synergistic product offerings between Outdoor brands and our larger portfolio, including Emtek hardware in the Yale and August connected locks, which we expect to drive incremental future growth.

Therma-Tru 看到了去年開始的開工和竣工數量增加帶來的好處。正如我們在國際建築商展上預覽上個季度的那樣，拉森正在以關鍵價位推出一些創新且流行的新產品。此外，我們將繼續推出戶外品牌和我們更大的產品組合之間的協同產品，包括 Yale 和 August 連接鎖中的 Emtek 硬件，我們預計這將推動未來的增量成長。

Once again, our Fiberon business is a great proof point of the power of our strong channel relationships. We saw over 20% growth for Fiberon in the profitable wholesale channel. And our POS data indicates that our Fiberon wholesale sell-through significantly outpaced the market.

我們的 Fiberon 業務再次證明了我們強大的通路關係的力量。我們看到 Fiberon 在盈利的批發管道中增長了 20% 以上。我們的 POS 數據表明，我們的 Fiberon 批發銷售量顯著超過了市場。

Finally, our Security segment grew sales 9% in the quarter but it was down high single digits on an organic basis, primarily due to destocking activities at select customers ahead of general consumer weakness. However, this segment also saw 170 basis points of operating margin improvement, inclusive of the investments in Yale and August smart lock residential brands as the work we did around continuous improvement and optimizing our footprint continues to pay off. We expect our Security segment will continue to benefit from the transformational work that we have done over the past 2 years.

最後，我們的安全部門本季銷售額成長了 9%，但有機下降了高個位數，這主要是由於特定客戶在普遍消費者疲軟之前進行了去庫存活動。然而，該細分市場的營業利潤率也提高了 170 個基點，其中包括對 Yale 和 August 智慧鎖住宅品牌的投資，因為我們圍繞持續改進和優化足跡所做的工作繼續得到回報。我們預計我們的安全部門將繼續受益於我們過去兩年所做的轉型工作。

We've evolved our legacy brands from mechanical-only products into innovative and growth-oriented businesses with a much more strategic portfolio. We will reinvest the efficiencies gained from our recent optimization of the business to take advantage of strong secular trends like connected products and safety. The Yale and August brands have proven to be a strong fit. In addition to being great assets, the Yale and August team is excellent and their capabilities have made significant contributions to our connected group across the product portfolio.

我們已經將傳統品牌從純機械產品發展成為具有更具策略性的產品組合的創新和成長導向業務。我們將重新投資最近優化業務所獲得的效率，以利用互聯產品和安全等強大的長期趨勢。事實證明，耶魯大學和奧古斯特品牌非常合適。除了擁有龐大的資產之外，耶魯大學和 August 團隊也非常出色，他們的能力為我們跨產品組合的互聯團隊做出了重大貢獻。

To recap, in the first quarter, we executed our priorities of focusing on the core and accelerating digital products and delivered above-market performance. For the remainder of 2024, we will continue this focus of driving above-market growth by pursuing incremental growth opportunities and by building on the foundational work established by our transformation into a brand, innovation and channel leader. We will proactively manage any dynamic periods while actively positioning Fortune Brands innovations for the future. We continue to have full confidence in our ability to meet the targets we outlined in our full year guidance on our fourth quarter call.

回顧一下，第一季度，我們執行了聚焦核心、加速數位化產品的工作重點，並且取得了高於市場的表現。在 2024 年剩餘時間裡，我們將繼續致力於透過尋求增量成長機會，並在我們轉型為品牌、創新和通路領導者所建立的基礎工作的基礎上，推動高於市場的成長。我們將積極管理任何動態時期，同時積極定位財富品牌的未來創新。我們仍然對實現第四季度電話會議全年指導中概述的目標的能力充滿信心。

I will now turn the call over to Dave.

我現在將把電話轉給戴夫。

Thanks, Nick. As a reminder, my comments will focus on income before charges and gains to best reflect ongoing business performance. Additionally, comparisons will be made against the same period last year, unless otherwise noted.

謝謝，尼克。提醒一下，我的評論將重點放在收費前收入和收益，以最好地反映持續的業務績效。此外，除非另有說明，否則將與去年同期進行比較。

Let me start with our first quarter results. As Nick highlighted, our teams executed our priorities amid a dynamic macro environment. As I will detail in my section, our financial results have some very compelling examples of how the transformative actions we undertook over the past 1.5 years are generating tangible returns.

讓我從第一季的業績開始。正如尼克所強調的，我們的團隊在動態的宏觀環境中執行了我們的優先事項。正如我將在本節中詳細介紹的那樣，我們的財務表現有一些非常引人注目的例子，說明我們在過去 1.5 年中採取的變革行動如何產生了切實的回報。

In the first quarter, sales were $1.1 billion, up 7% and down 3% excluding acquisitions. Consolidated operating income was $167 million, up 22%. Total company operating margin improved 200 basis points to 15.1% and earnings per share were $0.83, a 20% increase versus last year.

第一季銷售額為 11 億美元，成長 7%，不包括收購則下降 3%。綜合營業收入為 1.67 億美元，成長 22%。該公司總營業利潤率提高了 200 個基點，達到 15.1%，每股收益為 0.83 美元，比去年增長 20%。

Our first quarter performance was driven by higher-than-expected sales in our Outdoor and Water segments and resulting margin flow-through. As Nick mentioned, we remain focused on driving outperformance including above-market growth, enhancing margins and generating cash. Our teams continue to focus on managing our P&L and balance sheet while maintaining key strategic growth investments.

我們第一季的業績是由戶外和水上部門的銷售額高於預期以及由此產生的利潤流動所推動的。正如尼克所提到的，我們仍然專注於推動卓越表現，包括高於市場的成長、提高利潤率和產生現金。我們的團隊繼續專注於管理損益表和資產負債表，同時維持關鍵的策略性成長投資。

Now let me provide more color on our segment results. Beginning with Water Innovations, sales were $625 million, up $31 million or 5% and down 7%, excluding the impact of acquisitions. Our organic results reflect POS down mid-single digits and channel inventory reductions at select customers.

現在讓我為我們的細分結果提供更多資訊。從 Water Innovations 開始，銷售額為 6.25 億美元，成長 3,100 萬美元，或 5%，下降 7%（不包括收購的影響）。我們的有機結果反映了 POS 下降了中個位數，並且特定客戶的通路庫存減少了。

China sales declined mid-single digits and were up low single digits, excluding the impact of FX. As Nick indicated, the Chinese consumer remains cautious in the housing space and our team continues to manage the dynamic environment well while finding pockets of growth in the emerging channels and in product category expansion. Water Innovations operating income was $141.5 million an increase of 10%. Operating margin was 22.6%, an increase of 100 basis points, reflecting the impact of higher volumes.

排除匯率的影響，中國銷售額下降了中個位數，成長了低個位數。正如尼克所指出的，中國消費者對住房領域仍然持謹慎態度，我們的團隊繼續妥善管理動態環境，同時在新興管道和產品類別擴張中尋找成長點。 Water Innovations 營業收入為 1.415 億美元，成長 10%。營業利益率為 22.6%，增加了 100 個基點，反映了銷量增加的影響。

Turning to Outdoors. Outdoors had a strong first quarter. Sales were $315 million, up 9%, driven by strength in Doors and Fiberon wholesale. Door sales increased low double digits. Sales were supported by higher volumes at Therma-Tru, driven by the increase in single-family new construction. Decking sales were roughly flat, driven by strength in wholesale and partially offset by anticipated declines in retail.

轉向戶外。第一季戶外業務表現強勁。在門和 Fiberon 批發實力的推動下，銷售額達到 3.15 億美元，成長 9%。門銷量成長兩位數。由於單戶新建築的增加，Therma-Tru 銷量增加，從而支撐了銷售。受批發強勁的推動，地板銷售大致持平，但部分被零售預期下降所抵消。

Our results this quarter reflect our ongoing strategic approach of focusing on those core categories in which we expect to have the best opportunities to achieve long-term above-market growth and profitability. Outdoor segment operating income was $37.9 million, up 150%. Segment operating margin more than doubled to 12%, a 680 basis point improvement. Segment operating income increases were driven by favorable volume leverage in our businesses and productivity and profitability improvements. We believe this segment is on the right track as we focus on those parts of the market that will drive the greatest potential returns and growth and where we have the right to win.

我們本季的業績反映了我們持續的策略方針，即專注於那些我們預計將有最佳機會實現長期高於市場成長和獲利能力的核心類別。戶外部門營業收入為 3,790 萬美元，成長 150%。部門營業利潤率成長了一倍多，達到 12%，提高了 680 個基點。部門營業收入的成長得益於我們業務中有利的銷售槓桿以及生產力和獲利能力的提高。我們相信這個細分市場正走在正確的軌道上，因為我們專注於那些將帶來最大潛在回報和成長以及我們有權利獲勝的市場部分。

In Security, our first quarter sales increased 9%. Organic sales decreased 8%, reflecting soft POS and select channel destocking ahead of soft consumer activity. We continue to see momentum in the categories we have identified as having the higher growth potential such as Master Lock commercial and our connected security products. Segment operating income was $27 million, up 22%, and segment operating margin was 15.7%, an increase of 170 basis points versus prior year and was driven by continuous improvement initiatives. As we have discussed previously, we think our Security segment is a great example of the power of our Fortune Brands Advantage capabilities, and we expect great things from this business.

在安全領域，我們第一季的銷售額成長了 9%。有機銷售額下降 8%，反映出 POS 疲軟以及消費者活動疲軟先前精選通路庫存的減少。我們繼續看到我們認為具有較高成長潛力的類別的勢頭，例如瑪斯特鎖商業和我們的互聯安全產品。在持續改善措施的推動下，分部營業收入為 2,700 萬美元，成長 22%，分部營業利潤率為 15.7%，較上年增長 170 個基點。正如我們之前所討論的，我們認為我們的安全部門是我們 Fortune Brands Advantage 能力的一個很好的例子，我們對這項業務寄予厚望。

Turning to the balance sheet. Our balance sheet remains solid with cash of $360 million, net debt of $2.7 billion and our net debt-to-EBITDA leverage is 2.9x. We remain on track to achieve our target net leverage ratio of 2.25x by year-end. We have $875 million available on our revolver. In the first quarter, we returned $130 million to shareholders via a combination of share repurchases and dividends, including $100 million of share repurchases. Year-to-date, we have repurchased $125 million of shares. Our first quarter free cash flow was negative $136 million, reflecting the typical seasonality of our business and in line with our expectations.

轉向資產負債表。我們的資產負債表依然穩健，現金為 3.6 億美元，淨負債為 27 億美元，淨負債與 EBITDA 的槓桿比率為 2.9 倍。我們仍有望在年底前實現 2.25 倍的淨槓桿率目標。我們的左輪手槍有 8.75 億美元的可用資金。第一季度，我們透過股票回購和股利結合的方式向股東返還了 1.3 億美元，其中包括 1 億美元的股票回購。年初至今，我們已回購價值 1.25 億美元的股票。我們第一季的自由現金流為負 1.36 億美元，反映了我們業務的典型季節性，符合我們的預期。

To summarize the quarter, we delivered strong sales and margin results and are on the path of delivering on our full year commitments to grow sales above market, expand our margins and generate cash. While our first quarter results were certainly encouraging and speak to the strength of our business, we are aware of the dynamic macro environment.

總而言之，我們在本季度取得了強勁的銷售和利潤業績，並且正在兌現我們的全年承諾，即使銷售額高於市場水平，擴大利潤並產生現金。雖然我們第一季的業績確實令人鼓舞並說明了我們業務的實力，但我們也意​​識到動態的宏觀環境。

For the second quarter, we expect net sales growth of around 10%, with operating margins between 16.5% and 17%. Operating margins will be impacted by inefficiencies related to the startup of our 2 new water facilities, which we expect will provide long-term capacity for market- beating growth and cost savings for the business.

我們預計第二季淨銷售額將成長約 10%，營業利潤率在 16.5% 至 17% 之間。營運利潤率將受到與我們兩個新供水設施啟動相關的低效率的影響，我們預計這將為業務提供超越市場的成長和節省成本的長期能力。

Looking forward to the second half of the year, we continue to expect sales growth of between 2% and 3% and operating margins of around 18%. As a reminder, we closed on our Yale, August and Emtek acquisition in June of last year and the performance of those brands will be included in our second half organic results.

展望下半年，我們繼續預期銷售額成長在2%至3%之間，營業利潤率約18%。提醒一下，我們在去年 6 月完成了對 Yale、August 和 Emtek 的收購，這些品牌的業績將納入我們下半年的有機業績中。

Finally, we remain confident in our ability to hit our previously communicated full year 2024 guidance, including full year net sales up 3.5% to 5.5% with organic net sales down 1% to up 1% and operating margins between 16.5% and 17.5%, the midpoint of which includes 100 basis points of operating margin improvement. We continue to expect EPS of $4.20 to $4.40, the midpoint of which represents 10% earnings per share growth. Our teams are off to a great start against our full year targets and we'll remain focused on the execution of our key priorities.

最後，我們仍然對實現先前傳達的2024 年全年指導目標充滿信心，包括全年淨銷售額增長3.5% 至5.5%，有機淨銷售額下降1% 至增長1%，營業利潤率在16.5% 至17.5% 之間，其中中點包括營業利潤率改善的 100 個基點。我們繼續預期 EPS 為 4.20 美元至 4.40 美元，其中中點代表每股盈餘成長 10%。我們的團隊在全年目標方面取得了良好的開端，我們將繼續專注於執行我們的關鍵優先事項。

I will now pass the call back to Leigh to open the call for questions. Leigh?

我現在將把電話轉回 Leigh 以開始提問。利？

Thanks, Dave. That concludes our prepared remarks. We will now begin taking a limited number of questions. Since there are a number of you who would like to ask a question, I will ask that you limit your initial questions to 2 and then reenter the queue to ask additional questions. I will now turn the call back over to the operator to begin the question-and-answer session. Operator, can you open the line for questions? Thank you.

謝謝，戴夫。我們準備好的演講到此結束。我們現在將開始回答有限數量的問題。由於有很多人想提問，我會要求你們將最初的問題限制為 2 個，然後重新進入隊列詢問其他問題。我現在將把電話轉回接線生以開始問答環節。接線員，您可以開通提問線路嗎？謝謝。

(Operator Instructions). Our first question comes from John Lovallo with UBS.

（操作員說明）。我們的第一個問題來自瑞銀集團的約翰‧洛瓦洛。

Nick, maybe I'll start high level sort of where you started. And just looking for any update on the progress of the various kind of Fortune initiatives to align the company more as one company, whether it's connected products, integrated supply chain efforts, the transformation office. I mean where are the biggest opportunities for improvement this year?

尼克，也許我會從你開始的地方開始高水準的工作。只是尋找各種《財星》計劃的最新進展，以使公司更像公司，無論是互聯產品、整合供應鏈工作還是轉型辦公室。我的意思是，今年最大的改進機會在哪裡？

John, it's a great question. I mean, we're a little more than a year into that now, right? So as September '22 when we announced the realignment of the company. And we shy away from it, it is a heavy lift to go and redesigning an operating model. And then really work through a full cycle, which was 2023 of operating in that new model. And now we seem to be hitting our groove. And what I really look to -- what are the proof points of things that we've been able to get done that we might not have been able to get done had we not come together in this way.

約翰，這是一個很好的問題。我的意思是，我們現在已經一年多一點了，對吧？ 22 年 9 月，我們宣布了公司的重組。我們迴避它，重新設計營運模式是一項艱鉅的任務。然後真正完成一個完整的周期，即 2023 年以新模型運行。現在我們似乎已經達到最佳狀態了。我真正關注的是——我們已經能夠完成的事情的證據是什麼，如果我們不以這種方式走到一起，我們可能無法完成這些事情。

And I think you can see it across a number of things and firstly, the portfolio is getting increasingly cohesive. A lot of people remarked, I think at the industry shows at KBIS and IBS, seeing Emtek and House of Rohl together on display is really not just a proof but an example of what's really rolling out the market and the speed with which we were able to do that. I think it was very surprising coming into outdoors area and not just seeing products on display together, but starting to see how those innovations will work together to bring those technologies across the various brands in areas like Outdoors with Emtek.

我認為你可以在很多事情上看到這一點，首先，產品組合變得越來越有凝聚力。很多人評論說，我認為在 KBIS 和 IBS 的行業展會上，看到 Emtek 和 House of Rohl 一起展出確實不僅僅是一個證明，而且是真正推動市場發展以及我們能夠實現的速度的一個例子要做到這一點。我認為進入戶外領域非常令人驚訝，不僅看到一起展示的產品，而且開始看到這些創新如何協同工作，將這些技術帶到戶外領域的各個品牌中，例如與 Emtek 合作。

So you're starting to see the portfolio with the aligned organization being able to expect greater value than where it was less aligned or more siloed. So that is a big area for us. I think another big area is our op leverage, right? You just have now a single team supporting the entire business and the caliber of the team that comes with that. And what they're getting done and the time that they're getting it done is pretty remarkable.

因此，您開始看到，與不一致或更孤立的組織相比，一致的組織能夠獲得更大的價值。所以這對我們來說是一個很大的領域。我認為另一個重要領域是我們的營運槓桿，對嗎？您現在只有一個團隊來支援整個業務以及隨之而來的團隊的能力。他們所做的事情以及完成事情所花費的時間是相當驚人的。

I mean, if you just think about most recently, reformatting the entire security manufacturing footprint and doing it with the grace with which the team did it and leading people in a great place, but also driving the kind of results that you're seeing now start to come through security. They're optimizing our supplier spend and resilience at a greater speed than ever. They're getting more capacity out of Fiberon than we thought was there. And there are opening 2 major water facilities in this quarter alone. And I ask myself could we've gotten that amount done in this shorter time, prior to this? I think it's a great proof point.

我的意思是，如果你想想最近，重新格式化整個安全製造足跡，並以團隊所做的優雅來完成它，並帶領人們進入一個偉大的地方，同時也推動了你現在看到的那種結果開始通過安檢。他們正在以前所未有的速度優化我們的供應商支出和彈性。他們從 Fiberon 中獲得的容量比我們想像的要多。光是本季就有 2 個主要供水設施開業。我問自己，在此之前，我們能在更短的時間內完成這麼多工作嗎？我認為這是一個很好的證據。

And then finally, I might just point you to one of the things we're most excited about, which is our digital and connected journey where you have a single-aligned group of over 2 -- about 200 engineers. And we're operating much, much more like a mature digital business. They set out a set of milestones for example, for the Flo and smart water network for this year and achieve them a quarter ahead of schedule. I really don't think we could have done that without bringing the whole team together with the depth of knowledge that they now have.

最後，我可能會向您指出我們最興奮的事情之一，那就是我們的數位化和互聯之旅，其中您擁有一個由 2 多名（大約 200 名）工程師組成的單一團隊。我們的營運方式更像是一家成熟的數位企業。例如，他們為今年的 Flo 和智慧供水網路制定了一系列里程碑，並比原計劃提前了四分之一實現這些目標。我真的認為，如果沒有將整個團隊聚集在一起，利用他們現在擁有的豐富知識，我們就不可能做到這一點。

And so those are just a few proof points I could get into the things like the integration management office, which we didn't have before the progress of the fact that we already have Flo selling on SpringWell website. We're seeing great attachment rates there. I mean there's just a speed to things now and a clarity of vision across the whole business and I think while we always had that ambition, it was hard to unlock in the old structure.

因此，這些只是我可以進入諸如整合管理辦公室之類的事情的一些證據，在我們已經在 SpringWell 網站上銷售 Flo 的事實進展之前，我們沒有這些。我們在那裡看到了很高的依戀率。我的意思是，現在整個業務的發展速度加快了，願景也清晰了，我認為雖然我們一直有這樣的雄心，但在舊的結構中很難實現。

Got it. That's really helpful. And then maybe turning just to Outdoors. Revenue was up 9% in the first quarter versus your full year outlook of plus 1% to 3%. Was there some timing benefit here because the remainder of the year implies more modest growth on a year-over-year basis. And then along the same lines within decking, it sounds like retail may have been down meaningfully to offset that 20% increase in wholesale. So can you provide any color on what's going on there?

知道了。這真的很有幫助。然後也許只轉向戶外活動。第一季營收成長 9%，而全年預期成長 1% 至 3%。這裡是否存在一些時機優勢，因為今年剩餘時間意味著同比增長更為溫和。然後，在裝飾領域，零售業的下降似乎是為了抵消批發業 20% 的成長。那麼你能提供一些關於那裡發生的事情的資訊嗎？

Yes, I'll give you some perspectives and Dave can round it out on the rest of the year. I mean, obviously, super excited about the Outdoor for the quarter. I think you may have really seen that business coming into its own, and getting much more aligned under its leadership. Great performance out of the doors business. They did some work to align it. And of course, you're seeing new construction finally start to come through as we sort of move towards the end of the year and starting into this year as that ticks back up. So some really good stuff there.

是的，我會給你一些觀點，戴夫可以在今年剩下的時間裡完善它。我的意思是，顯然，我對本季的戶外活動感到非常興奮。我認為您可能確實看到了該業務的發展，並在其領導下變得更加協調。戶外業務表現出色。他們做了一些工作來調整它。當然，隨著我們接近年底並進入今年，隨著這種情況的回升，你會看到新的建設終於開始完成。所以那裡有一些非常好的東西。

On Fiberon, you're absolutely right. I mean, we made some strategic calls to really focus that on the most profitable part of the market, where we can hopefully generate the types of margins we'd like to see in order to be able to fuel future growth and future innovation. I mean, that's really how we think about the margin journey and the whole company is this, that's a real purpose.

關於 Fiberon，你是絕對正確的。我的意思是，我們做出了一些策略性呼籲，真正將重點放在市場上最有利可圖的部分，我們希望能夠在其中產生我們希望看到的利潤類型，以便能夠推動未來的成長和未來的創新。我的意思是，這確實是我們對利潤旅程的看法，整個公司就是這樣，這是一個真正的目標。

And so we're seeing really the growth continue to come through the wholesale channel and seeding some in the retail channel. And then very interestingly for us as we start to see some of the work that we've been at Larson for the last couple of years, hit the marketplace.

因此，我們確實看到成長繼續來自批發管道，並在零售通路中播種一些。然後，對我們來說非常有趣的是，當我們開始看到過去幾年我們在拉森所做的一些工作進入市場時。

And so Larson kind of go through a total refresh with some of the ideas that we had coming into that acquisition, but with the pandemic and some of the changes we had to make and some of the less profitable business that we walked away from, just took a while to align that organization and now starting to see some really positive POS coming there. So I'd say in whole, really good quarter coming in ahead of where we thought and gives us some good confidence for not just the rest of the year, but where we take this business from here.

因此，拉爾森對我們收購時的一些想法進行了徹底的更新，但隨著大流行和我們必須做出的一些改變以及我們放棄的一些利潤較低的業務，只是花了一段時間來調整該組織，現在開始看到一些真正積極的POS 出現。因此，我想說，總的來說，這個季度的表現非常好，超出了我們的預期，不僅給我們帶來了良好的信心，不僅對今年剩餘時間，而且對我們今後開展這項業務的方向都有信心。

And John, I'd add with the Outdoor segment, we saw POS up mid-single digits, which was mostly volume driven in the quarter. And then as a reminder, we had a low single-digit benefit from a prior year inventory reduction primarily in Therma-Tru that took place last quarter. So that drove the 9% sales.

約翰，我想補充一點，在戶外領域，我們看到 POS 成長了中個位數，這主要是本季銷售驅動的。提醒一下，我們從上個季度主要是 Therma-Tru 的去年庫存減少中獲得了較低的個位數收益。這推動了 9% 的銷售額。

Going forward, we do think a better quarter than we expected. It gives us confidence in the full year guide. It helped us derisk some of the second half sales expectations. I think that's true across the business when you look at our first quarter results. And then with Outdoors specifically, as the volume returns, and we weren't drawing down inventory, you saw significant volume -- margin improvement driven by volume and by productivity, and we expect that to continue through the year, a really good start for that business out of the gate.

展望未來，我們確實認為這個季度會比我們預期的更好。它讓我們對全年指南充滿信心。它幫助我們降低了下半年銷售預期的一些風險。我認為，當你看看我們第一季的業績時，整個產業都是如此。然後，特別是在戶外領域，隨著銷量的回升，並且我們沒有減少庫存，您會看到銷量顯著- 利潤率在銷量和生產力的推動下有所改善，我們預計這種情況將持續到今年，這對我們來說是一個非常好的開始那個生意就出門了。

Our next question comes from Phil Ng with Jefferies.

我們的下一個問題來自 Jefferies 的 Phil Ng。

After a slower start, it looks like your business certainly picked up. Any color on how (inaudible) going to progress early read in April? -- little surprise here, some of your customers are still destocking, I think, in security and water. What channel? And have you seen that kind of calm down and maybe restock potentially?

經過較慢的起步後，您的業務似乎確實有所改善。關於四月早期閱讀的進展（聽不清楚）有什麼顏色嗎？ ——我認為，你們的一些客戶仍在減少安全和水方面的庫存，這並不奇怪。什麼管道？您是否曾經看過這種平靜下來並可能重新進貨的情況？

Yes. I'd say we -- as we called out on the last call, not unusually, but the year started a little slow and then certainly picked up, I would say, it's been a bit -- it's a bit choppier towards the end of the quarter, particularly as some of the noise around interest rates picked up, but you are kind of still seeing resilience where we've called it out. So the wholesale channels, single-family new construction, some areas like Larson.

是的。我想說，正如我們在最後一次電話會議上所說的那樣，這並不罕見，但這一年開始的時候有點慢，然後肯定會有所回升，我想說，這有點——接近年底時有點不穩定。所以批發管道，單戶新建，有些地區像拉森。

I think going forward, we'll see as we come into the season just -- how it picks up. There's certainly -- we're seeing a lot of consumer interest, as mentioned in the prepared remarks, we're still seeing searches up relative to even last year. We're seeing -- responding some surveys, saying they're planning projects. And so I think we just need to manage it. As far as the destocking part of your question is concerned, it was interesting because we see that particularly in e-commerce more than elsewhere, but e-commerce and a little bit of wholesale across the business.

我認為展望未來，當我們進入本賽季時，我們會看到情況如何好轉。當然，正如準備好的評論中提到的，我們看到了很多消費者的興趣，我們仍然看到搜尋量甚至比去年有所上升。我們看到——回應一些調查，說他們正在規劃專案。所以我認為我們只需要管理它。就你問題中的去庫存部分而言，這很有趣，因為我們看到這一點尤其是在電子商務領域比其他地方更多，但電子商務和整個行業的一點批發。

So it wasn't really isolated to just one spot (inaudible) more, but we're going to saw some customers. I think taking inventory ahead of what they might perceive as some general consumer weakness. And so those channels look pretty thin from inventory perspective to us at this point.

所以它並沒有真正孤立到只有一個地方（聽不清楚），但我們會看到一些顧客。我認為在他們可能認為消費者普遍疲軟之前先清點庫存。因此，從庫存角度來看，目前這些管道對我們來說看起來相當薄弱。

And then Phil, on your POS trend question. I'll provide some color sequentially. So first quarter POS finished dollar for dollar almost exactly in line with the fourth quarter. So typically, I think we'd see a first quarter that's a little bit softer than the fourth. But we were dollar for dollar almost equal, Q4 '23 to Q1 '24. And as we've moved through April, we've seen our retail and e-commerce POS ramp seasonally as we would expect, moving from the first quarter to the second quarter, though still negative though over year, that the channel serving single-family new construction continue to show growth, and we've seen nice input trends to start the quarter in those businesses, in those channels.

然後 Phil，關於您的 POS 趨勢問題。我將依次提供一些顏色。因此，第一季 POS 的美元兌美元匯率幾乎與第四季完全一致。因此，通常情況下，我認為我們會看到第一季比第四季稍微疲軟。但從 23 年第 4 季到 24 年第 1 季度，我們的匯率幾乎相等。隨著我們進入4 月份，我們看到我們的零售和電子商務POS 正如我們預期的那樣季節性增長，從第一季度到第二季度，儘管與去年同期相比仍然是負面的，但服務於單一通路的通路家庭新建建築持續呈現成長，我們在這些業務、這些管道中看到了本季開始的良好投入趨勢。

Super. That's helpful. And then on your Water Innovation business, helpful -- kind of give us a little more color on how to think about the margin profile perhaps in 2Q in the back half just given perhaps some of the start-up costs from the new facilities as you kind of ramp that up. And then some of the investments and growth opportunities you see in connected products, water filtration and Flo, how should we think about the margin profile of that business versus, let's say, your core Moen business?

極好的。這很有幫助。然後，關於您的水創新業務，很有幫助——讓我們對如何考慮後半段第二季度的利潤狀況有更多的了解，因為您可能會考慮到新設施的一些啟動成本。然後，您在互聯產品、水過濾和 Flo 領域看到的一些投資和成長機會，我們應該如何考慮該業務相對於您的核心摩恩業務的利潤狀況？

Yes. On the connected side, really strong contribution margins, a little bit ahead of the core, it's still in an investment phase. So we're managing those investments coming through. But product margins are good. And then on the margin side, overall, for the segment, we still feel confident in tracking to that 24% to 24.5% full year margin target. And actually, we're a little bit ahead of our internal expectations in Q1. I think you'll see sequential improvement Q1 to Q2 and then continued sequential improvement as we move through the back half of the year.

是的。在互聯方面，貢獻率非常高，稍微領先核心，但仍處於投資階段。因此，我們正在管理這些投資。但產品利潤率不錯。然後在利潤率方面，總體而言，對於該細分市場，我們仍然有信心實現 24% 至 24.5% 的全年利潤率目標。事實上，我們第一季的業績略高於我們的內部預期。我認為您會看到第一季到第二季的連續改善，然後隨著我們進入今年下半年，繼續連續改善。

And we're ramping up new facilities and getting the savings there and as we have some continued price/cost favorability through the P&L.

我們正在增加新設施並在那裡節省開支，並且透過損益表我們有一些持續的價格/成本優勢。

Our next question comes from Adam Baumgarten with Zelman.

我們的下一個問題來自 Adam Baumgarten 和 Zelman。

Could you give some more color on the upcoming smart water partnership in California? It sounds pretty interesting. Just anything else you could add?

您能否對即將在加州建立的智慧水合作關係進行更多介紹？聽起來很有趣。您還可以添加其他什麼嗎？

Sure. I mean we've got a number of these, I would say, in [Moen] works right now. So you're going to be (inaudible) to us being ahead on some internal milestones that we're really excited about. And then we're working on a number we referenced one, but a number of external partnerships that we believe could really amplify the business.

當然。我想說的是，我們現在在[摩恩]的作品中已經有了很多這樣的東西。因此，您將（聽不清楚）看到我們在一些內部里程碑上取得了領先，我們對此感到非常興奮。然後我們正在研究我們提到的一些數字，但我們相信一些外部合作夥伴關係可以真正擴大業務。

A, as well sort of just bring kind of -- whether it's ease purchase of price point, placement, installation to life. B, awareness, right? Awareness is still a huge thing for a category that's very nascent. And we'll be complementing that with our ad campaign that is just rolling out now, which will all be awareness around the odds that you will have an event like this in your house. And so -- these are big initiatives. They're big partnerships. And I've long said it.

答，也只是帶來某種──無論是購買價格點、放置、安裝的便利性。 B、意識，對吧？對於一個非常新生的類別來說，意識仍然是一件大事。我們將透過現在剛推出的廣告活動來補充這一點，這將讓大家意識到您在家中舉辦這樣的活動的可能性。所以——這些都是重大舉措。他們是大型合作夥伴。而且我早就說過了。

I don't think this is an if, it's a when, this category really starts to take hold. And I think what we're seeing now is sort of a buildup of momentum and initiatives that we think is really going to sort of amplify our voice and this new category's voice out in front of the consumer. And I also mentioned 85% uptick in POS, in retail and e-commerce in the quarter, I would say, caught us by surprise -- caught us a little bit by surprise. We're actually going to accelerate the amount of inventory we're going to bring in to support our customers in this space. And I do think between our internal activities in both the product are activities speaking externally, whether it be through media marketing, online, you see much more activity. And then through these partnerships, whether it be with municipalities, insurers, I think you're really going to see an amplification of what we're doing in the marketplace. Very excited about it.

我不認為這只是“如果”，而是“何時”這個類別真正開始佔據主導地位。我認為我們現在看到的是一種勢頭和舉措的積累，我們認為這確實會在消費者面前放大我們的聲音和這個新類別的聲音。我還提到本季 POS、零售和電子商務成長了 85%，我想說，這讓我們感到驚訝——讓我們有點驚訝。實際上，我們將加快庫存量的增加，以支援該領域的客戶。我確實認為，我們在這兩個產品中的內部活動都是對外活動，無論是透過媒體行銷還是在線，你都會看到更多的活動。然後透過這些合作關係，無論是與市政當局、保險公司，我認為你真的會看到我們在市場上所做的事情擴大。對此非常興奮。

Great. And then, Dave, maybe for you, just on input costs for the year, how you think about that and maybe generally price costs as we move through the year?

偉大的。然後，戴夫，也許對你來說，只是關於今年的投入成本，你如何看待這一點，也許我們在這一年中的整體價格成本？

Yes. So still, it's a line of sight to -- on the price side, being net price positive for the full year, no change there in our businesses. Most of our businesses took gross price in the first quarter, and we're successful with that implementation. On the cost side, we still expect net deflation of around 1% of COGS.

是的。因此，在價格方面，全年淨價為正，我們的業務沒有變化。我們的大多數業務在第一季都採用了總價格，我們的實施取得了成功。在成本方面，我們仍預期淨通貨緊縮約為銷貨成本的 1%。

Our base input costs really, here in the second quarter, have increased some of our base metals. But I'd remind everyone the way our supply chain is structured that we really won't see that impact in our P&L until either very, very late in or really -- more likely the first quarter of 2025 as any movement in base metals doesn't change the price for us until the following quarter, and then we'll have to work through with supply chain. So that gives our team some visibility to what's coming and allows them to work on price and cost actions to get ahead of it. So I feel good about our price cost estimates for the year that we laid out on the last call.

在第二季度，我們的基本投入成本確實增加了我們的一些基本金屬。但我想提醒大家，我們供應鏈的結構方式是，直到非常非常晚或實際上——更有可能是2025 年第一季度，我們才會真正看到這種對損益表的影響，因為賤金屬的任何變動都不會影響我們的損益表。因此，這使我們的團隊對即將發生的事情有一定的了解，並允許他們在價格和成本方面採取行動以搶先一步。因此，我對我們在上次電話會議中列出的當年價格成本估算感到滿意。

Our next question comes from Stephen Kim with Evercore ISI.

我們的下一個問題來自 Evercore ISI 的 Stephen Kim。

Yes. Great. You made a comment about how, I guess, there was a little bit of slowing at the end of the quarter. It sounds like into April, you've seen some -- you saw some -- maybe some improving signs, I guess, in e-commerce and retail POS. I just -- I don't want to put words in your mouth, but I guess would you say that, that was better than what you saw at the end of the quarter or not? And would it be fair to say that the beat in 1Q and then not raising the guide, for the year sort of reflect some cautiousness based on what you saw at the end of the quarter.

是的。偉大的。我想，您評論了本季末經濟成長略有放緩的情況。聽起來好像到了四月份，你已經看到了一些——你看到了一些——我想，也許在電子商務和零售 POS 領域有一些改善的跡象。我只是——我不想把話放在你嘴裡，但我想你會說，這比你在本季度末看到的要好嗎？公平地說，第一季的節拍，然後沒有提高今年的指導，某種程度上反映了基於​​您在季度末看到的情況的一些謹慎態度。

Yes. I would -- I think that's absolutely right. It's still choppy out there, and we want to see how it evolves. I don't want to get too excited about a couple more weeks and things are looking a little bit healthier. I just think the consumers' pretty choppy. And so we wanted to see how it evolves. We are overall happy with the quarter relative to expectations, but I'd say we want to get well beyond where we are today. Few more weeks into the spring and summer before we have a really good read on the year.

是的。我會——我認為這是絕對正確的。那裡仍然不穩定，我們想看看它如何演變。我不想對接下來的幾週感到太興奮，事情看起來會更健康一些。我只是覺得消費者相當不穩定。所以我們想看看它是如何演變的。相對於預期，我們總體上對本季度感到滿意，但我想說，我們希望遠遠超出今天的水平。距離春季和夏季還有幾週時間，我們才能對這一年有一個真正的了解。

Yes. And Steve, on POS, I think of it as sequentially week-on-week improving numbers, which we would expect to see given where we are in the season. Building a ramp seasonally though year-over-year still negative for retail and e-commerce, but for us is really our best read into R&R. That said, as I mentioned on the flip side, single-family new construction input remains in the growth mode, and I think that will continue a strong level of starts. Single-family starts in the first quarter, though completions were still down 6%. So the -- as we -- as our products come in closer to a complete that negative completion rate really get a good line of sight to continued volume flow through the year as builders work through the uptick in start.

是的。史蒂夫，在 POS 上，我認為這是逐週連續改善的數字，考慮到我們在本賽季的情況，我們預計會看到這一點。雖然季節性成長對零售和電子商務仍然不利，但對我們來說確實是我們對 R&R 的最佳解讀。也就是說，正如我在另一方面提到的，單戶新建投入仍處於成長模式，我認為這將繼續保持強勁的開工水準。單戶住宅於第一季開工，但竣工量仍下降 6%。因此，隨著我們的產品越來越接近完成率，負完成率確實可以很好地看到全年持續的銷售流量，因為建築商在開始時就在努力上升。

Got you. Okay. Right. But with respect to the POS, the ramp you're seeing is kind of just normal seasonality. So not something that we should get too excited about. Yes. Okay. Yes. Perfect.

明白你了。好的。正確的。但就 POS 而言，您看到的成長只是正常的季節性。所以我們不應該對此感到太興奮。是的。好的。是的。完美的。

You made some comments with respect to the 2 facilities in water weighing a little bit. Can you quantify that for us in some way? And I think you made some comment also about Chinese consumers sort of transitioning away from new construction to R&R. I was just kind of curious, what does that entail? Maybe provide a little context around that?

您對水中的兩個設施稍重提出了一些評論。您能以某種方式為我們量化嗎？我認為您也對中國消費者從新建築轉向休閒度假的情況發表了一些評論。我只是有點好奇，這代表什麼？也許提供一些相關的背景資訊？

On the facility piece, from a margin standpoint, I'd say 25 to 50 basis points in the quarter of margin headwind is for facilities ramp up and we have production inefficiencies relative to a normal rate. And then on the China question, that market, especially as we move away from speculative new construction, I think, which drove a lot of the sales to R&R, we're seeing in our business, Chinese consumers engaging in different categories.

在設施方面，從利潤率的角度來看，我想說，本季利潤率逆風上升 25 至 50 個基點是因為設施增加，而相對於正常水平，我們的生產效率低下。然後就中國問題而言，這個市場，特別是當我們遠離投機性的新建築時，我認為這推動了 R&R 的大量銷售，我們在我們的業務中看到，中國消費者參與不同的類別。

So there's a home decoration channel. That's new, probably has emerged over the past 3-ish years that the team is really taking some nice share and then focusing our efforts on e-commerce and in our showroom network to make sure we're capturing the R&R as the market transitions. It is -- we do see a transition. It has been -- the overhang of new construction has been greater than the transition to R&R at this point.

於是就有了居家裝潢頻道。這是新的，可能是在過去三年多的時間裡出現的，團隊確實取得了一些不錯的份額，然後將我們的努力集中在電子商務和展廳網絡上，以確保我們在市場轉型時抓住R&R 的機會。我們確實看到了轉變。目前，新建設的懸而未決的問題已經大於向 R&R 的過渡。

Yes. Interestingly, for a lot of last year, you actually saw growth in some of those R&R channels that Dave was mentioning. And so you could see consumers coming in. It's just the preponderance of the size of the new construction that needs to go on the plate before you really see that. But it's a natural transition for that market to now make. A lot of these are established. And then I just -- if you recall that our exposure is predominantly to Tier 1 and Tier 2 cities.

是的。有趣的是，在去年的大部分時間裡，你實際上看到了戴夫提到的一些 R&R 頻道的成長。所以你可以看到消費者湧入。但對該市場來說，這是一個自然的轉變。其中很多都是成立的。然後我只是——如果你還記得我們的業務主要集中在一、二線城市。

So that's where we have the highest share and that's where and most of the R&R demand will start to form. And so we love the optionality of the market. The team has done the right job managing that P&L and keeping the profitability very, very healthy as we've navigated through this. And we like optionality that it gives us to get exposure to R&R as well as the innovation engine that it brings because in that market, that team is highly innovative and is also building up new adjacencies -- will result in growth.

因此，這就是我們擁有最高份額的地方，也是大部分 R&R 需求將開始形成的地方。所以我們喜歡市場的選擇性。在我們度過這個過程的過程中，團隊在管理損益表方面做得很好，並保持了非常非常健康的獲利能力。我們喜歡選擇性，它讓我們能夠接觸 R&R 以及它帶來的創新引擎，因為在這個市場中，該團隊具有高度創新性，並且也在建立新的鄰接關係 - 將帶來成長。

Our next question comes from Matthew Bouley with Barclays.

我們的下一個問題來自巴克萊銀行的 Matthew Bouley。

I'll ask on security. It sounded like it was a little softer in Q1 there, maybe a little bit of destocking as well. It looks like you held the full year guide unchanged. So just any additional elaboration on sort of what happened in Q1 and then the confidence in some improvement to kind of achieve that full year guide?

我去問安全問題聽起來第一季的情況有些疲軟，也許還有一點去庫存。看起來你的全年指南保持不變。那麼，對第一季度發生的事情有任何額外的闡述，然後對實現全年指南的一些改進有信心嗎？

Sure. as security, just talking more on the Master Lock and SentrySafe side of the portfolio, most of the -- really, really healthy last year. Then you can see the consumer kind of slowed towards the end of the year, and we saw that continue to play out into Q1. But interestingly, I'd say that decline in Q1 of about 50% of that is destocking, right? And so that brings actual PLS number much closer to kind of mid-single digits.

當然。至於安全性，只是更多地談論產品組合中的 Master Lock 和 SentrySafe 方面，其中大部分去年都非常非常健康。然後你可以看到消費者在年底時有所放緩，我們看到這種情況在第一季繼續發揮作用。但有趣的是，我想說第一季約 50% 的下降是去庫存，對嗎？因此，這使得實際的 PLS 數字更接近中個位數。

And there's a lot of work underway in that business to drive into much, much more of a growth business by focusing both on some exciting areas like commercial where it's now 1/3 of the business, and we've been seeing really, really nice growth. Connected integrating it with the Yale and August side where we think we can drive a lot of growth. As well as just refreshing the offering in both safe and in padlock, now it's going to start to hit shelves as we go through the year. And so A lot of work has gone to reengineer that business over the last few years and just starting (inaudible) the business to a much, much healthier margin profile and gives us confidence to invest and sort of stick behind where this business is heading and continue to be very excited about it.

該業務正在進行大量工作，透過專注於一些令人興奮的領域（例如商業領域）來推動更多、更多的成長業務，商業領域現在佔業務的1/3，我們已經看到了非常非常好的情況生長。將其與耶魯大學和 August 方面進行整合，我們認為我們可以推動很大的成長。除了以保險箱和掛鎖形式更新產品外，現在它也將在今年開始上架。因此，在過去的幾年裡，我們做了很多工作來重新設計該業務，並且剛開始（聽不清楚）該業務的利潤狀況要好得多，這讓我們有信心進行投資，並在某種程度上堅持該業務的發展方向，繼續對此感到非常興奮。

Secondly, just looking at the balance sheet, it looks like inventory dollars stepped up a bit, presumably the acquisition played into that. But maybe just kind of refresh us on how you're thinking about inventory going forward? Does there need to be any sort of rightsizing of production from here? Or is that really just the acquisition? Any additional color there?

其次，僅看資產負債表，庫存美元似乎增加，大概是收購發揮了作用。但也許只是讓我們了解一下您對未來庫存的看法？這裡是否需要對生產進行任何形式的調整？或者這真的只是收購嗎？還有其他顏色嗎？

Matt, I'd say a few things. the acquisition is a piece of it, but also say we're back more to a normal seasonal first quarter where we're building inventory for a couple of reasons: one, to mitigate Chinese New Year supply chain impacts and two, in advance of spring and summer seasons. And so we still expect to deliver free cash flow conversion of around 100% for the year and have positive free cash flow quarters Q2 to Q4, which is consistent with this business. So I don't think there's anything unusual in the results.

馬特，我想說幾句話。這次收購是其中的一部分，但也要說我們回到了正常的季節性第一季度，我們出於以下幾個原因建立庫存：一是為了減輕農曆新年供應鏈的影響，二是在春節之前春季和夏季。因此，我們仍然預計今年的自由現金流轉換率約為 100%，且第二季至第四季的自由現金流為正，這與這項業務是一致的。所以我不認為結果有什麼異常。

I think actually last year, first quarter was more unusual as we're pulling inventory down at such a rapid rate. We had positive free cash flow in the first quarter of '23. So I think it's back to normal results. And the team continues to work to optimize inventory, and we'll do so throughout the year more driven by systems enhancements and process enhancements and then the final driver is we brought in a bit of extra inventory to buffer our supply chain against the Suez Canal and Panama Canal disruptions that have taken place. We're probably holding on to that maybe a bit longer than we expected through the year, just given those continued disruptions.

我認為實際上去年第一季更加不尋常，因為我們以如此快的速度減少庫存。 23 年第一季我們的自由現金流為正。所以我認為這已經恢復到正常結果了。團隊將繼續努力優化庫存，我們將在全年中這樣做，更多地受到系統增強和流程增強的推動，最後的推動因素是我們引入了一些額外的庫存，以緩衝我們的供應鏈免受蘇伊士運河的影響以及已經發生的巴拿馬運河中斷。考慮到這些持續的干擾，我們今年的堅持時間可能比我們預期的要長一些。

And the other thing I'd add to that is, going back to the first question about the aligned organization. Which simply excited me and you saw a lot of this last year, and I think we'll continue to see this year is there's not kind of one budgeting operations team really owning not just inventory, but thinking about the total balance sheet from a shareholder perspective and working to pull every lever on it. And so they're having conversations with some of our suppliers.

我要補充的另一件事是，回到關於協調組織的第一個問題。這讓我很興奮，去年你看到了很多這樣的情況，我想今年我們將繼續看到，沒有一個預算運營團隊真正不僅擁有庫存，還考慮股東的總資產負債表視角並努力拉動每一個槓桿。因此他們正在與我們的一些供應商進行對話。

We're going to have to put extra inventory on the water to support all of our businesses, what are the impacts of total working capital, how do we think about that? And just having that shareholder lens inside the business, sort of working all the time is part of what's going to drive total working capital improvement beyond just inventory. And I think the big drivers last year, and I think you'll continue to see that improvement in this year.

我們將不得不在水中投入額外的庫存來支持我們所有的業務，總營運資金的影響是什麼，我們如何看待這一點？只要在企業內部擁有股東的視角，一直在工作，就能推動整體營運資本的改善，而不僅僅是庫存。我認為去年的主要推動因素，我認為今年你將繼續看到這種改進。

Our next question comes from Susan Maklari with Goldman Sachs.

我們的下一個問題來自高盛的 Susan Maklari。

Thank you. Good afternoon, everyone. My first question is on the acquisition you did of the water filtration operations there, which is an interesting add your whole smart water network that you're building out there. Can you talk a bit about that opportunity, how it fits into this where it can go over time, the potential there? And maybe just how to think about the M&A pipeline more broadly and what you're seeing as well?

謝謝。大家下午好。我的第一個問題是關於您在那裡收購水過濾業務的情況，這是一個有趣的添加您在那裡建立的整個智慧水網絡。您能談談這個機會嗎？也許只是如何更廣泛地思考併購管道以及您所看到的情況？

Sure. I'll start with SpringWell. So it's a space we've been looking at for quite some time. We've been fairly discerning about wanting to find a very high-quality entry point into that business. But I'll break it down. I mean, firstly, just the business itself. We're excited about that addressable market. It's $4 billion in the U.S. alone today, it's growing. Concern about water quality is growing. And there's going to be a tech enablement for that and the ability to know the quality water kind of coming in and out of your system. And so just in and of itself, a very exciting entry point.

當然。我將從 SpringWell 開始。所以這是我們已經關注很長時間的一個空間。我們一直非常敏銳地希望找到一個非常高品質的進入該業務的切入點。但我會把它分解。我的意思是，首先，只是業務本身。我們對這個潛在市場感到興奮。如今光在美國就達到了 40 億美元，而且還在成長。人們對水質的擔憂與日俱增。並且將有一個技術支援來實現這一點，並且能夠了解進出系統的水質。因此，就其本身而言，這是一個非常令人興奮的切入點。

Secondly, a digital native business, right. Started up as digital native, the team -- not even sure they used that word because there's no other way to build the business when you started today. And just as we have with Yale August or with Emtek, team is really kind of holding it to the side and saying, "I want to learn everything about what you do and be careful to integrate only the best of the best if they do something better than we do. We're going to adopt that into our business." and we're being very, very deliberate about that. But their ability to interact with consumers in a digital setting, the speed at which they can get things done the way they work a sale is very, very interesting to us. And that is a capability that we will seek to adopt over the entire business. And so another flow that is pretty interesting.

其次，數位原生業務，對吧。作為數位原生代，團隊甚至不確定他們是否使用了這個詞，因為當你今天開始時沒有其他方法來建立業務。就像我們與Yale August 或Emtek 的合作一樣，團隊實際上是將其放在一邊並說：「我想了解有關您所做工作的所有內容，並且如果他們做了某件事，請小心地只整合最好的人才我們將把它應用到我們的業務中。我們對此非常非常慎重。但他們在數位環境中與消費者互動的能力，以及他們以銷售方式完成工作的速度，對我們來說非常非常有趣。我們將尋求在整個業務中採用這種能力。另一個非常有趣的流程。

And then the third part is just -- there is a lot of industrial logic around our smart water network and filtration. They go in at the same point. Certainly flow -- I mean there's other elements to the smart water network, but the flow goes in at the same point as filtration. And if you're coming in to get someone to touch your main and to put a filter on it or vice versa put a flow on it, it is a very logical cross-sell.

第三部分是－圍繞我們的智慧水網絡和過濾有很多工業邏輯。他們在同一點進去。當然是流量——我的意思是智慧水網路還有其他元素，但流量與過濾在同一點進入。如果你進來是為了讓某人接觸你的主管道並在其上放置一個過濾器，或者反之亦然，在其上放置一個流量，這是一個非常合乎邏輯的交叉銷售。

So really is an early experiment and kind of remarkable that seem got has done perfectly, we just flow up on their side. I wouldn't say we spent on training them on Flo and really understanding how it works, and we're seeing double-digit attachment rate. So that thesis is playing itself out very quickly.

所以這確實是一個早期的實驗，而且看起來已經完成得非常出色，我們只是站在他們這邊。我不會說我們花了很多錢對他們進行 Flo 培訓並真正了解其工作原理，而且我們看到了兩位數的依戀率。所以這篇論文很快就得到了證實。

And so we're excited about where we can take is to continue to push into the water quality arena and do it in a smart way. We think this is going to be a very, very important foundational piece to whole smart water network.

因此，我們感到興奮的是，我們可以繼續進入水質領域，並以明智的方式做到這一點。我們認為這將成為整個智慧水網路非常非常重要的基礎部分。

And then the second part of your question, the M&A pipeline continues to be robust. We'll continue to be very, very disciplined about how we think about it. But as we deepen these capabilities, I think you'll find us to be more selective around things that really have these secular growth tailwinds like a water quality, right? It's probably growing double digits as an area. But we're going to be able to go deeper and extract more value from them. And so going forward, I'm excited about what's up in the pipeline. I think it's going to generate a lot of cash, we'll be disciplined in deciding how to deploy it in the best manner possible for shareholders, but I think there's going to be a lot of interesting opportunity to continue to build our business.

然後是你問題的第二部分，併購通路仍然強勁。我們將繼續非常非常自律地思考它。但隨著我們深化這些能力，我想你會發現我們對那些真正長期成長順風的事情（例如水質）會更有選擇性，對嗎？它的面積可能會以兩位數的速度成長。但我們將能夠更深入地挖掘它們並從中獲得更多價值。因此，展望未來，我對即將發生的事情感到興奮。我認為這將產生大量現金，我們將嚴格決定如何以盡可能為股東提供最佳方式部署現金，但我認為將有很多有趣的機會來繼續發展我們的業務。

Okay. All right. That's encouraging. And then maybe turning a bit to the consumer. You talked a fair amount about new versus R&R activity in the quarter. But anything that you would highlight in terms of consumer behavior or any changes you're seeing in the business across the various price points, luxury versus some of the other offerings that you have? Just anything of note there? And I guess, anything that's changed in the last couple of weeks as well with that.

好的。好的。這令人鼓舞。然後也許會轉向消費者。您對本季的新活動與 R&R 活動進行了大量討論。但是，在消費者行為方面，或者您在不同價位的業務中看到的任何變化、奢侈品與您擁有的其他一些產品之間，您有什麼要強調的嗎？有什麼值得注意的嗎？我想，過去幾週發生的任何變化也會隨之而來。

I don't know -- and Dave, feel free to add color. I don't know that a ton has changed. Just thinking back to some of the trends we talked about on the last call, and I did mention, I think, consumer has still been somewhat choppy. I think the luxury consumer has outperformed. If I look at the point of sale for the luxury business was probably up mid-single digits. And so more recently -- they're kind of still at the same rate, almost 2x what the underlying water business is doing. Consumer interest continues to be there. We do a lot of work around that to make sure that we're right because we're placing bets on where that consumer will be.

我不知道——戴夫，請隨意添加顏色。我不知道發生了很多變化。回想一下我們在上次電話會議中討論的一些趨勢，我確實提到過，我認為消費者仍然有些波動。我認為奢侈品消費者表現出色。如果我看看奢侈品產業的銷售點可能會上升到中個位數。最近，它們仍然保持著相同的速度，幾乎是基礎水務業務的兩倍。消費者的興趣仍然存在。我們圍繞這個問題做了很多工作，以確保我們是正確的，因為我們正在押註消費者會在哪裡。

We are continuing to see a shift online. And so being very cognizant about investing in and building our online capabilities. And that's not just the pricing piece is the whole online shelf and the ability to manage that. I think SpringWell is going to play very, very well to that capability. But beyond that, I don't think a whole lot new, Dave gave some color around kind of the sequential dollars that we're seeing through retail and e-commerce. And I think we just want to see how it plays out now.

我們繼續看到網路上的轉變。因此，我們非常了解投資和建立我們的線上能力。這不僅僅是定價部分，還包括整個線上貨架和管理能力。我認為 SpringWell 將非常非常好地發揮這種能力。但除此之外，我認為這並不是什麼新鮮事，戴夫對我們透過零售和電子商務看到的連續美元給了一些顏色。我想我們現在只想看看結果如何。

I do think as the noise around rate stabilizes, whether that impacts (inaudible) that move or not and has not impacted our product that much, but just a level of confidence probably does. And you hopefully see more consumers come in and do some of these projects that they're talking with us.

我確實認為，隨著利率周圍的噪音穩定下來，無論這是否會影響（聽不清楚）移動或不移動，並且不會對我們的產品產生太大影響，但只是一定程度的信心可能會產生影響。您希望看到更多的消費者參與並完成他們正在與我們討論的一些項目。

Yes, I would agree with everything Nick said in relation to the consumer as they're engaged with us in housing. I think one area we did see a change is in security from our recent trends. And that probably speaks more towards the broader consumer. That's a piece of the portfolio that's more exposed generally to the consumer. And as we look at where the POS trends were soft, it was on the consumer products that were really a bit core and then some of the noncore things like TSA locks, bike locks and things that were maybe purchased in the prior quarters -- yes, that weren't going forward. And so I think that maybe a reading of how the broader consumer is thinking that it's a trend we'll keep an eye on, but I think everything Nick said around the consumer with respect to how they -- we haven't seen a lot of change in trends in that state.

是的，我同意尼克所說的有關消費者的一切，因為他們在住房方面與我們互動。我認為我們確實看到變化的一個領域是我們最近趨勢的安全性。這可能更能代表更廣大的消費者。這是產品組合中更容易接觸到消費者的一部分。當我們看到 POS 趨勢疲軟的地方時，消費產品確實有點核心，然後是一些非核心產品，例如 TSA 鎖、自行車鎖以及可能在前幾個季度購買的產品 - 是的，那沒有進展。因此，我認為，也許要了解更廣泛的消費者如何認為這是我們將密切關注的趨勢，但我認為尼克圍繞消費者所說的一切都是關於他們如何——我們還沒有看到很多該州趨勢的變化。

Thank you for joining today's conference call. You may now disconnect.

感謝您參加今天的電話會議。您現在可以斷開連線。