Gates Industrial Corporation PLC (GTES) 2024 Q1 法說會逐字稿

Thank you for standing by, and welcome to the Gates Industrial Corporation First Quarter 2024 Earnings Conference Call. (Operator Instructions).

感謝您的耐心等待，歡迎參加蓋茲工業公司 2024 年第一季財報電話會議。 （操作員說明）。

I would now like to turn the call over to Rich Kwas. Please go ahead.

我現在想把電話轉給 Rich Kwas。請繼續。

Good morning, and thank you for joining us on our first quarter 2024 earnings call. I'll briefly cover our non-GAAP and forward-looking language before passing the call over to our CEO, Ivo Jurek, will be followed by Brooks Mallard, our CFO.

早安，感謝您參加我們的 2024 年第一季財報電話會議。在將電話轉給我們的執行長伊沃·尤雷克(Ivo Jurek) 之前，我將簡要介紹我們的非公認會計準則和前瞻性語言，隨後我們的首席財務官布魯克斯·馬拉德(Brooks Mallard) 將接聽電話。

Before the market opened today, we published our first quarter 2024 results. A copy of the release is available on our website at investors.gates.com. Our call this morning is being webcast, is accompanied by a slide presentation. On this call, we will refer to certain non-GAAP financial measures that we believe are useful in evaluating our performance. Reconciliations of historical non-GAAP financial measures are included in our earnings release and the slide presentation, each of which is available in the Investor Relations section of our website.

今天開盤前，我們發布了 2024 年第一季業績。新聞稿的副本可在我們的網站 Investors.gates.com 上取得。我們今天早上的電話會議正在網路上直播，並附有幻燈片演示。在這次電話會議上，我們將參考某些我們認為有助於評估我們績效的非公認會計準則財務指標。我們的收益發布和幻燈片簡報中包含了歷史非公認會計原則財務指標的調節表，每一項都可以在我們網站的投資者關係部分中找到。

Please refer to now Slide 2 of the presentation, which provides a reminder that our remarks will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks that could cause actual results to be materially different from those expressed in or implied by such forward-looking statements. These risks include, among others, matters that we have described in our most recent annual report on Form 10-K and in other filings we make with the SEC. We disclaim any obligation to update those forward-looking statements.

現在請參閱簡報的投影片 2，其中提醒我們，我們的言論將包括《私人證券訴訟改革法案》含義內的前瞻性陳述。這些前瞻性陳述存在風險，可能導致實際結果與此類前瞻性陳述中明示或暗示的結果有重大差異。這些風險包括我們在最新的 10-K 表格年度報告以及我們向 SEC 提交的其他文件中所述的事項等。我們不承擔更新這些前瞻性陳述的義務。

Later this month, we will be attending the Wolfe Global Transportation & Industrials Conference and the KeyBanc Industrials & Basic Materials Conference. We look forward to meeting with many of you. Before we start, please note all comparisons are against the prior year period unless stated otherwise.

本月晚些時候，我們將參加沃爾夫全球運輸與工業會議以及 KeyBanc 工業與基礎材料會議。我們期待與你們中的許多人會面。在我們開始之前，請注意，除非另有說明，所有比較均與去年同期進行。

With that out of the way, I'll now turn the call over to Ivo.

解決完這個問題後，我現在將把電話轉給 Ivo。

Thank you, Rich. Good morning, everyone, and thank you for joining our call today. We will kick off today on Slide 3. We generated revenues above the midpoint of our February revenue guidance and within the range we provided at our Capital Markets Day in March. Globally, Automotive continued to outperform industrial end markets. Our global replacement revenues increased slightly with automotive replacement leading the way by delivering mid-single-digit growth.

謝謝你，里奇。大家早安，感謝您今天加入我們的電話會議。我們將從今天的幻燈片 3 開始。在全球範圍內，汽車市場的表現持續優於工業終端市場。我們的全球更換收入略有成長，其中汽車更換業務以中個位數成長領先。

Broadly speaking, order activity improved as March progressed and our book-to-bill ratio finished at a higher level in March as compared to book-to-bill for the full quarter. Our order fill rates and the associated service levels to our customers continue to trend up nicely as we continue to sharpen our operational execution on more efficient through the cycle performance.

總體而言，隨著 3 月的進展，訂單活動有所改善，與整個季度的訂單出貨比相比，我們 3 月的訂單出貨比達到了更高的水平。隨著我們繼續提高營運執行效率，提高整個週期績效，我們的訂單履行率和為客戶提供的相關服務水準繼續呈現良好趨勢。

Our operating performance in the quarter was strong and resulted in significant margin expansion. Our adjusted EBITDA margin increased 330 basis points year-over-year to 22.7%. Our gross margin grew 210 basis points compared to the first quarter of 2023, despite encountering a volume decline in the quarter. We are making headway with our enterprise initiatives, particularly in material cost reduction and with 80/20.

我們本季的經營業績強勁，利潤率顯著擴大。我們調整後的 EBITDA 利潤率年增 330 個基點，達到 22.7%。儘管本季銷量下降，但與 2023 年第一季相比，我們的毛利率增加了 210 個基點。我們的企業計劃正在取得進展，特別是在降低材料成本和 80/20 方面。

The higher replacement sales mix relative to last year also contributed to our gross margin expansion. In addition, our SG&A spending decreased year-over-year, which included higher-than-expected insurance proceeds. We made more progress with our balance sheet during the quarter. Our net leverage declined to 2.4x from 2.7x in the prior year quarter. We executed on the commitment we've made on our year end 2023 earnings call to repay debt, reducing our outstanding term loan balance by $100 million.

與去年相比，更高的替換銷售組合也促進了我們毛利率的成長。此外，我們的銷售管理、行政管理支出較去年同期下降，其中包括高於預期的保險收益。本季我們的資產負債表取得了更多進展。我們的淨槓桿率從去年同期的 2.7 倍下降至 2.4 倍。我們履行了在 2023 年底財報電話會議上做出的償還債務承諾，將未償還定期貸款餘額減少了 1 億美元。

In addition, we used excess cash to repurchase $50 million of our shares in conjunction with Blackstone secondary offering in February. Based on our strong profitability results in Q1, we are increasing our full year adjusted EBITDA guidance. We experienced a good start to the year and believe we are in a solid position to generate strong operating leverage as our industrial end markets progressively start to experience and anticipated demand recovery later in the year. Brooks will provide further color on our updated 2024 guidance later in the presentation.

此外，我們也結合 Blackstone 2 月的二次發行，使用多餘現金回購了 5,000 萬美元的股票。基於我們第一季強勁的獲利能力，我們正在提高全年調整後 EBITDA 指引。我們今年經歷了良好的開局，並相信，隨著我們的工業終端市場逐步開始經歷並預期今年晚些時候的需求復甦，我們處於穩固的地位，可以產生強大的營運槓桿。布魯克斯將在稍後的演示中進一步介紹我們更新的 2024 年指南。

Now please turn to Slide 4. First quarter total revenue was $863 million, which represented a 3.6% decrease on a core basis. The automotive end market grew modestly driven by mid-single-digit growth in replacement. The bulk of our industrial end markets experienced revenue declines on a core basis, driven by the industrial First Fit channel, which was down double digits.

現在請翻到投影片 4。汽車終端市場在替換率中個位數成長的推動下溫和成長。在工業 First Fit 通路的推動下，我們的大部分工業終端市場的核心收入都出現了下降，該通路的收入下降了兩位數。

Core industrial replacement revenues decreased modestly. Our book-to-bill remained above 1 in the quarter and expanded in March, led by an improving order cadence. I will also note that we have seen order intake greater than what we've experienced in Q1 of prior year, which signals to us a stabilizing market with pockets of specific weakness, offsetting more solid performance elsewhere. We are encouraged by this activity.

核心工業替代收入小幅下降。我們的訂單出貨比在本季維持在 1 以上，並在訂單節奏改善的帶動下，在 3 月有所擴大。我還要指出的是，我們的訂單量比去年第一季的訂單量要多，這向我們表明市場正在穩定，但存在一些特定的弱點，抵消了其他地方更穩健的表現。這項活動讓我們深受鼓舞。

Adjusted EBITDA was $196 million and yielded a margin of 22.7%. EBITDA margin expanded 330 basis points, supported by the key enterprise initiatives as well as the increased mix of replacement sales compared to the prior year period. Adjusted earnings per share was $0.31. Our operating income grew well over 30% and contributed $0.10 of adjusted EPS, which was partially offset by higher effective tax rate in this year's quarter as well as mix of other items.

調整後 EBITDA 為 1.96 億美元，利潤率為 22.7%。與去年同期相比，在關鍵企業措施以及替換銷售組合增加的支持下，EBITDA 利潤率擴大了 330 個基點。調整後每股收益為 0.31 美元。我們的營業收入成長超過 30%，貢獻了 0.10 美元的調整後每股收益，但部分被今年季度較高的有效稅率以及其他項目所抵消。

On Slide 5, let's review our segment performance. In the Power Transmission segment, our revenues came in at $533 million, which represented a 1.7% decrease on a core basis. At the channel level, replacement grew about 2%, fueled by automotive replacement, which grew mid-single digits.

在投影片 5 上，我們回顧一下我們的部門績效。在電力傳輸領域，我們的收入為 5.33 億美元，核心收入下降了 1.7%。在通路層面，在汽車替代品成長中個位數的推動下，替代品成長了約 2%。

First Fit revenues decreased high single digits with Industrial experiencing a double-digit decline and Automotive growing slightly. End market performance was mixed with energy on highway construction and automotive realizing low to mid-single-digit core growth, which was offset by declines in personal mobility, diversified industrial and agriculture.

First Fit 收入出現高個位數下降，工業收入出現兩位數下降，汽車業務略有成長。終端市場表現參差不齊，高速公路建設和汽車能源實現了低至中位數的核心成長，但被個人流動性、多元化工業和農業的下降所抵消。

Of note, the magnitude of the declines in these end markets began to ease relative to previous quarters and the diversified industrial end market in North America is showing signs of stability. Our adjusted EBITDA margin increased nicely, benefiting from contributions from our various enterprise initiatives and a higher mix of replacement sales.

值得注意的是，這些終端市場的下滑幅度相對前幾季開始有所緩解，北美多元化的工業終端市場正呈現穩定的跡象。我們的調整後 EBITDA 利潤率大幅成長，得益於我們各種企業計畫的貢獻以及更高的替代銷售組合。

Our Fluid Power segment posted revenues of $330 million. Revenues fell about 6% with core revenues posting a just under 7% decrease partially offset by favorable foreign currency effects of almost 100 basis points. Industrial First Fit declined double digits, driven by weaker activity in agriculture and construction. Automotive replacement was a bright spot, growing mid- to high single digits. Fluid Power segment, adjusted EBITDA margins improved 410 basis points fueled by stronger operating performance that was supported by the ongoing execution of our enterprise initiatives.

我們的流體動力部門營收達 3.3 億美元。收入下降約 6%，其中核心收入下降近 7%，部分被近 100 個基點的有利外匯影響所抵銷。由於農業和建築業活動疲軟，工業首次下降了兩位數。汽車更新換代是一個亮點，呈現中高個位數成長。流體動力部門的調整後 EBITDA 利潤率提高了 410 個基點，這得益於我們持續執行企業計畫的強勁營運績效。

I will now turn the call over to Brooks for additional details on our results. Brooks?

我現在將把電話轉給布魯克斯，以了解有關我們結果的更多詳細資訊。布魯克斯？

Thank you, Ivo. Moving now to Slide 6 and an overview of our core revenue performance by region. Most of our geographic regions outperformed the enterprise core revenue results. In North America, core sales decreased 3%, driven by weaker industrial trends. Industrial channel core revenues declined high single digits, primarily due to a double-digit decrease in First Fit. Industrial replacement fell low single digits. Agriculture weakness was the most impactful to our performance, followed by personal mobility, consistent with our expectations.

謝謝你，伊沃。現在轉到投影片 6，概述我們按地區劃分的核心收入表現。我們大多數地理區域的表現都優於企業核心收入結果。在北美，由於工業趨勢疲軟，核心銷售下降了 3%。工業通路核心收入出現高個位數下降，主要是因為 First Fit 出現兩位數下降。工業替代率下降至個位數低點。農業疲軟對我們的業績影響最大，其次是個人流動性，這與我們的預期一致。

We now anticipate the personal mobility destocking to abate as we exit Q2 and anticipate steady recovery in revenue generation from the second half of 2024 onwards. Additionally, we saw relative stability in Diversified Industrial, where revenues were about flat with last year.

我們現在預計，隨著第二季的結束，個人出行去庫存將會減弱，並預計從 2024 年下半年起收入將穩定恢復。此外，我們看到多元化工業相對穩定，收入與去年持平。

Automotive increased mid-single digits, with solid growth in both replacement and First Fit. In EMEA, core revenues fell 8% and was most impactful to our overall company core revenue decline. Industrial First Fit was down double digits, and most of the industrial end markets in the EMEA region realized decreases. Automotive replacement grew modestly and was a partial offset to the weaker industrial trend. China core revenues grew modestly and benefited from strong demand in the automotive replacement channel, which expanded in the high teens. Automotive First Fit was down, while Industrial grew slightly with end market performance mix.

汽車行業增長了中個位數，替換和首次安裝均實現穩健增長。在歐洲、中東和非洲地區，核心收入下降了 8%，對我們公司整體核心收入下降的影響最大。 Industrial First Fit 出現兩位數下滑，歐洲、中東和非洲地區大部分工業終端市場均出現下滑。汽車更新換代溫和成長，部分抵消了工業趨勢的疲軟。中國的核心收入小幅成長，並受益於汽車更換管道的強勁需求，該管道在十幾歲的時候一直在擴張。汽車First Fit 下降，而工業則因終端市場表現組合略有成長。

In general, we observed overall demand showing more stability in China, although our expectations are measured in the near term. East Asia and South America posted slight declines in core revenues with Automotive outperforming Industrial in both regions. In general, core growth was largely consistent with our expectations.

總體而言，我們觀察到中國的整體需求更加穩定，儘管我們的預期是在短期內衡量的。東亞和南美洲的核心收入略有下降，這兩個地區的汽車業表現優於工業業。整體而言，核心成長基本上符合我們的預期。

On Slide 7, we show an adjusted earnings per share wall from the prior year quarter. Operating performance contributed approximately $0.10 per share and fueled the growth. The operating performance strength was partially offset by a higher-than-expected tax rate due to the booking of certain discrete tax items in the quarter and a mix of other items. The discrete tax items mostly involve changes in estimates around valuation allowances that we expect largely to be offset by other activity as the year progresses.

在投影片 7 上，我們顯示了去年同期調整後的每股盈餘牆。經營業績貢獻了每股約 0.10 美元並推動了成長。由於本季登記了某些離散稅項和其他項目，稅率高於預期，部分抵銷了經營業績的優勢。離散稅收項目主要涉及估值津貼估計的變化，我們預計隨著時間的推移，這些變化將在很大程度上被其他活動所抵消。

Slide 8 provides an update on our cash flow performance and balance sheet. Our free cash flow for the first quarter was an outflow of $39 million. This result is in line with our normal seasonal performance. Our net leverage ratio declined to 2.4x, which was 0.3x lower than the prior year period and reflected a $100 million reduction in our term loan.

投影片 8 提供了我們現金流表現和資產負債表的最新情況。我們第一季的自由現金流為流出 3,900 萬美元。這結果與我們正常的季節性表現相符。我們的淨槓桿率下降至 2.4 倍，比去年同期低 0.3 倍，反映出我們的定期貸款減少了 1 億美元。

During the first quarter, we received a ratings upgrade from S&P. Additionally, late last week, Moody's bumped our credit rating 1 notch higher to Ba3. Our trailing 12-month return on invested capital increased approximately 300 basis points to 23.1%, with the increase mostly driven by our strengthening profitability. At the end of Q1, we had $50 million remaining under our existing share repurchase authorization.

第一季度，我們獲得了標準普爾的評級上調。此外，上週晚些時候，穆迪將我們的信用評級提高了 1 級至 Ba3。我們過去 12 個月的投資資本回報率增加了約 300 個基點，達到 23.1%，這一增長主要是由於我們盈利能力的增強。截至第一季末，我們現有的股票回購授權剩餘 5,000 萬美元。

Shifting to our updated 2024 guidance on Slide 9. We have increased our full year 2024 adjusted EBITDA guidance to a range of $745 million to $805 million. Q1's outperformance represents most of the increase. We are reiterating guidance for core revenue growth, adjusted earnings per share, capital expenditures and free cash flow conversion. The higher adjusted EBITDA for the year is expected to be offset by a higher effective tax rate for 2024.

轉到幻燈片 9 上更新的 2024 年指引。第一季的優異表現佔了大部分成長。我們重申對核心收入成長、調整後每股盈餘、資本支出和自由現金流轉換的指導。今年較高的調整後 EBITDA 預計將被 2024 年較高的有效稅率所抵銷。

For the second quarter, we expect revenues to be in the range of $880 million to $910 million. We expect a low single-digit decline in core growth year-over-year as we expect industrial headwinds to continue through the second quarter. We estimate our adjusted EBITDA margin will expand approximately 50 to 100 basis points compared to the prior year.

我們預計第二季的營收將在 8.8 億美元至 9.1 億美元之間。由於我們預計工業逆風將持續到第二季​​度，因此我們預計核心成長將比去年同期出現低個位數下降。我們估計調整後的 EBITDA 利潤率將比前一年擴大約 50 至 100 個基點。

On Page 10, we show an updated walk relative to the midpoint of the initial adjusted earnings per share guidance we provided in February. Greater savings contribution from our enterprise initiatives are being fully offset by the higher effective tax rate, which we expect to be 200 to 300 basis points higher versus the initial expectation we outlined in February. Please note that our adjusted earnings per share guidance does not incorporate any incremental share repurchase activity.

在第 10 頁，我們顯示了相對於我們 2 月提供的初始調整後每股盈餘指引中點的更新後的走勢。我們的企業計畫帶來的更大的儲蓄貢獻完全被更高的有效稅率所抵消，我們預計該稅率將比我們 2 月概述的最初預期高出 200 至 300 個基點。請注意，我們調整後的每股盈餘指引不包含任何增量股票回購活動。

With that, I will turn it back over to Ivo.

有了這個，我會把它轉回給伊沃。

Thank you. On Slide 11, I'll summarize our key messages before we take your questions. First, I'm pleased with our solid operating performance to start 2024. Our margin performance was healthy, and we are gaining traction with our various enterprise initiatives, particularly in the areas of material cost reduction in 80/20. Our material science competencies are driving process efficiencies and material savings benefits. We see signs that industrial activity is beginning to stabilize, although we expect markets like ag and construction to stay soft for the time being.

謝謝。在投影片 11 上，我將在回答您的問題之前總結我們的關鍵資訊。首先，我對 2024 年開始的穩健營運表現感到滿意。我們的材料科學能力正在提高流程效率並節省材料。我們看到工業活動開始穩定的跡象，儘管我們預計農業和建築業等市場暫時保持疲軟。

Core growth, in our diversified industrial end markets has flattened out over the last couple of quarters after a period of softness and the order intake activity we saw in Q1 would suggest more stability in certain industrial markets. The improvement in March PMI is encouraging, but we need to see a continued trend before we become more constructive on the near-term volume inflection for our business. As such, we have maintained a pragmatic view of our top line growth expectation for the year.

經過一段時間的疲軟之後，我們多元化的工業終端市場的核心成長在過去幾季已經趨於平緩，我們在第一季看到的訂單接收活動表明某些工業市場更加穩定。 3 月 PMI 的改善令人鼓舞，但我們需要看到持續的趨​​勢，然後才能對我們業務的近期成交量轉折點變得更具建設性。因此，我們對今年的營收成長預期保持務實的看法。

Second, we are executing on our commitments we have made to our shareholders. We believe we are effectively deploying capital and continue to strengthen our balance sheet as evidenced by our 2 recent rating HSC upgrades. We reduced gross debt in the first quarter in parallel with repurchasing shares. We are highly focused on achieving our 2026 targets outlined at our March Capital Markets Day as we drive margin and cash flow improvements. Our strategic optionality should expand, and we intend to be opportunistic.

其次，我們正在履行對股東的承諾。我們相信，我們正在有效地部署資本，並繼續強化我們的資產負債表，最近兩次 HSC 評級上調就證明了這一點。我們在第一季減少了總債務，同時回購了股票。隨著我們推動利潤率和現金流的改善，我們高度重視實現 3 月資本市場日所製定的 2026 年目標。我們的策略選擇應該擴大，我們打算投機取巧。

I'll finish by expressing my appreciation to almost 15,000 global Gates associates for their diligence and dedication with a particular focus on execution of our key priorities as well as commitment to meet our customers' expectations.

最後，我要向全球近 15,000 名蓋茲員工表示感謝，感謝他們的勤奮和奉獻，特別是對我們關鍵優先事項的執行以及對滿足客戶期望的承諾。

With that, I will now turn the call back over to the operator to begin the Q&A.

現在，我將把電話轉回接線員以開始問答。

Thank you. We will now begin the question-and-answer session. (Operator Instructions). The first question comes from the line of Nigel Coe with Wolfe Research.

謝謝。我們現在開始問答環節。 （操作員說明）。第一個問題來自沃爾夫研究中心的奈傑爾‧科 (Nigel Coe)。

So just was wondering, in the context of Q1 realized growth, Q2, obviously, looking at down 3.5% year-over-year. What is the pathway here to the plus 1 high end for the full year? What needs to go right in the back half? And obviously, I recognize you got immediate comp and maybe within that, just talk about what sort of price contribution we have coming through in the back half of the year?

所以我想知道，在第一季實現成長的背景下，第二季顯然年減 3.5%。全年達到+1高端的途徑是什麼？後半部需要做什麼？顯然，我認識到您立即得到了補償，也許在其中，請談談我們在今年下半年經歷了什麼樣的價格貢獻？

Hi, Nigel. So for the second half of the year, we're staying pretty pragmatic. First of all, the comps do get easier, right, because we started to see the industrial things trough out last year. And then as we said in our prepared remarks, we expect personal mobility to stabilize and start to come back. And then it's just the rest of the industrial market just starting to come back a little bit. Our automotive replacement business has been really good through the first quarter. So it's really the personal mobility stabilizing and then the industrial market is starting to come back. And we just have to wait and see. We've seen some stabilization, we've seen some pockets of things getting better, but then we're seeing some pockets of things that really haven't turned yet.

嗨，奈傑爾。因此，在今年下半年，我們將保持相當務實的態度。首先，比較確實變得更容易了，對吧，因為我們去年開始看到工業領域陷入低谷。然後，正如我們在準備好的演講中所說，我們預計個人流動性將穩定並開始回歸。然後工業市場的其餘部分才開始稍微回升。我們的汽車更換業務在第一季表現非常好。所以，這確實是個人流動性趨於穩定，然後工業市場開始復甦。我們只需要拭目以待。我們看到了一些穩定，我們看到一些事情正在變得更好，但隨後我們看到一些事情實際上還沒有好轉。

And there's no reason to believe the auto aftermarket wouldn't maintain at these levels through the year?

沒有理由相信汽車售後市場今年不會維持在這樣的水平？

No. Not really. I mean we anticipated this is the underlying demand trends are very strong. The order flows are very strong. The book-to-bill is very strong. So we anticipate that the automotive aftermarket will continue to outperform.

不，不是真的。我的意思是，我們預計這是一個非常強勁的潛在需求趨勢。訂單流量非常強勁。訂單到賬單非常強勁。因此我們預計汽車售後市場將繼續跑贏大盤。

Okay. And my follow-on is a quick follow-on the 2Q guide. And if I'm doing the math wrong, I think we're looking for a slight downtick in margins from Q1 to Q2. And I think usually, we have Q1 margins a little bit lower than Q2. So just wondering what specific kind of dynamics we should be, kind of paying attention to as we go from Q1 and Q2? Obviously, still a very, very healthy level of margin. Just wondering about that Q1 to Q2 dynamic.

好的。我的後續內容是 2Q 指南的快速後續內容。如果我計算錯誤，我認為我們正在尋找從第一季到第二季的利潤率略有下降。我認為通常情況下，我們第一季的利潤率會比第二季低。所以只是想知道我們應該從第一季和第二季開始關注什麼樣的具體動態？顯然，利潤率仍然非常非常健康。只是想知道第一季到第二季的動態。

Yes. The big thing is on SG&A, we had some kind of out of normal good news in Q1 related to some insurance things and some FX transactional tailwinds that we had, that we don't expect to happen through the balance of the year. And then we also have a little bit of an uptick in terms of labor spending relative to SG&A when the merit increases come in and things like that. So almost all of the, kind of as you'd say, I wouldn't say headwind, but the normal uptick you would expect from an EBITDA margin perspective is really related to SG&A and kind of some one-off benefits that we had in Q1.

是的。最重要的是SG&A，我們在第一季收到了一些與保險相關的不尋常的好消息，以及我們所擁有的一些外匯交易順風，我們預計在今年剩餘時間內不會發生這種情況。然後，當績效增加等因素出現時，我們的勞動支出相對於 SG&A 也會略有上升。因此，幾乎所有的，正如你所說，我不會說逆風，但從 EBITDA 利潤率的角度來看，你所期望的正常增長確實與 SG&A 以及我們在Q1.

Your next question comes from the line of Jeff Hammond of KeyBanc Capital Markets.

您的下一個問題來自 KeyBanc Capital Markets 的 Jeff Hammond。

This is David Tarantino on for Jeff. Maybe just to start on the margin line relative to the raised outlook here seems all around the incremental self-help. Could you give us some more color on where specifically that $0.06 of the incremental self-help is coming from? Is this pull forward? Or is it, you just finding more incremental opportunities versus what you initially identified?

我是大衛·塔倫提諾為傑夫配音。也許只是從相對於此處提高的前景的邊際線開始，似乎一切都圍繞著增量自助。您能否詳細說明一下增量自助的 0.06 美元具體來自何處？這是向前拉嗎？或者，您只是發現了與最初確定的相比更多的增量機會？

Yes. So I think there's -- if you think about Q1, we did a little bit better on mix because the replacement business was a little bit better. We did a little bit better on the enterprise initiatives. Price, we're using 80/20 as kind of the underlying -- underpinning infrastructure on a lot of the stuff that we do now, and that helped with price a little bit. And then productivity came in a little bit better in Q1.

是的。所以我認為，如果你考慮第一季度，我們在混合方面做得更好一點，因為替換業務更好一點。我們在企業計劃方面做得更好。價格，我們使用 80/20 作為底層——支撐我們現在做的很多事情的基礎設施，這對價格有所幫助。第一季的生產力提高。

And then as you move through the year, we expect price not to be as helpful as it was in Q1, but we expect productivity to get a little bit better as we move through the year. And a lot of that is driven by material cost productivity. As Ivo said in his at the end of his comments, the material science work that we're doing on material cost out is coming to fruition, and we expect that to continue through the balance of the year. So even with volumes being down, we're able to expand our margins. And so that's really a lot of the hard work we've done around material productivity and material cost out.

然後，隨著這一年的推移，我們預計價格不會像第一季那樣有幫助，但我們預計生產力會隨著這一年的推移而有所改善。其中很大一部分是由材料成本生產率所驅動的。正如伊沃在評論結尾處所說，我們在材料成本方面所做的材料科學工作即將取得成果，我們預計這種情況將持續到今年剩餘時間。因此，即使銷量下降，我們也能夠擴大利潤。因此，這確實是我們圍繞材料生產率和材料成本所做的大量艱苦工作。

Okay. Great. And maybe just to follow up on the comments around the improvement in order rates in the quarter. Could you give some color on where you're seeing this? And maybe just give some context. I mean just relative sales were kind of at the lower end guidance provided in March. So maybe just level set us on where you're seeing the more positive near-term trends and when you'd expect this to show through?

好的。偉大的。也許只是為了跟進有關本季訂單率改善的評論。你能告訴我你在哪裡看到的這個嗎？也許只是提供一些背景資訊。我的意思是，相對銷售額處於 3 月提供的指導下限。那麼，也許只是讓我們知道您在哪裡看到了更積極的近期趨勢以及您預計這種趨勢何時會顯現出來？

Yes. So look, I would say that on the order rates, we are seeing little bit stronger order rates in automotive replacement. We're seeing a more constructive market backdrop in industrial replacement order rates, particularly in North America. As a reference to prior year and maybe sequentially. So I'd say that those were bigger drivers. We did see some blanket orders being placed as well for some of the longer project type businesses that we anticipate to ship through the year.

是的。因此，我想說，就訂單率而言，我們看到汽車更換領域的訂單率稍強。我們看到工業替代訂單率更具建設性的市場背景，特別是在北美。作為前一年的參考，也許可以依序參考。所以我想說這些是更大的驅動力。我們確實看到一些我們預計全年發貨的較長項目類型業務也下了一些一攬子訂單。

When I take a look at what the distributors are selling to which kind of is a very important indicator for us. I mean, we are seeing pretty good stability in the inventory channel. So the order rates now are more in line with what we would anticipate to ship out. And that being said, it's slightly offset by maybe a little more negative backdrop in ag and commercial construction. So I kind of try to package both of your segments of your question into one answer, hopefully, that answer your question?

當我看經銷商賣給哪一種產品時，這對我們來說是一個非常重要的指標。我的意思是，我們看到庫存管道相當穩定。因此，現在的訂單率更符合我們預期的出貨量。話雖這麼說，但農業和商業建築領域的負面背景可能稍微抵消了這種影響。因此，我嘗試將您問題的兩個部分打包成一個答案，希望能夠回答您的問題？

Yes. Great.

是的。偉大的。

The next question comes from the line of Steve Volkmann of Jefferies.

下一個問題來自傑富瑞 (Jefferies) 的史蒂夫福克曼 (Steve Volkmann)。

I'm curious if it's possible to sort of break down the benefits of the enterprise initiatives on margin relative to the benefits that sounded like you got on mix because of the automotive aftermarket?

我很好奇是否有可能將企業計劃的利潤收益與聽起來像是汽車售後市場帶來的收益進行分解？

Yes. So the mix impact in Q1 was about 50 basis points of gross margin expansion. And so then we had about 50 bps of inflation, so I mean, deflation and favorable FX and then the balance of it was enterprise initiatives, offset by some volume headwinds.

是的。因此，第一季的混合影響是毛利率擴張約 50 個基點。然後我們的通膨率約為 50 個基點，所以我的意思是，通貨緊縮和有利的外匯，然後它的平衡是企業舉措，被一些成交量逆風所抵消。

Got it. Okay. That's helpful. And then how should we think about the rest of the year? I guess I'm struck by the fact that you sound like things are sort of improving directionally, and you sound fairly optimistic but really didn't raise the rest of the year. Is there a mix headwind as the rest of these businesses come back a little bit as the rest of the year?

知道了。好的。這很有幫助。那我們該如何思考今年剩下的時間呢？我想我對這樣一個事實感到震驚：你聽起來好像事情正在朝著方向性改善，而且你聽起來相當樂觀，但實際上在今年剩下的時間裡沒有籌集資金。隨著這些業務的其餘部分與今年剩餘時間相比略有回升，是否存在混合逆風？

Steve, I wouldn't say that there's a headwind on the mix. We're just being pragmatic about what we are forecasting for the next 3 quarters. It's early in the year while we are seeing improvements. As I said, I feel it's more of a stabilizing market environment. There are some puts and takes. There are some end markets that are less constructive like ag and commercial construction. And while the PMI will add 1 positive month, we really need to see a validation, that's not just a head fake, but it's a real infection in the underlying macros. And so as the year progresses, we certainly would feel that we would assess and forecast if that's warranted. But at this point in time, we're just trying to take a pragmatic view of the rest of the year.

史蒂夫，我不會說混合中存在逆風。我們只是對未來三個季度的預測持務實態度。現在是年初，我們看到了一些改進。正如我所說，我覺得這更像是一個穩定的市場環境。有一些放和取。有些終端市場的建設性較差，例如農業和商業建築。雖然 PMI 將增加 1 個月的正數，但我們確實需要看到驗證，這不僅僅是一個假象，而是對基礎宏觀的真正感染。因此，隨著時間的推移，我們當然會覺得我們會評估和預測是否有必要。但目前，我們只是試圖對今年剩餘時間採取務實的看法。

Your next question comes from the line of Jerry Revich of Goldman Sachs.

你的下一個問題來自高盛的傑瑞·雷維奇（Jerry Revich）。

I wonder if you won't mind just expanding on the deflation comment that you mentioned the 50 basis point tailwind in the first quarter. How much of that was from improved on-time deliveries and efficiencies versus lower freight cost? And what kind of momentum is there as the supply chain normalizes for you folks? You can just flesh out on what that might look like in 2Q based on the start so far.

我想知道您是否介意擴大您提到的第一季50個基點的通貨緊縮評論。其中有多少是由於準時交貨和效率的提高以及貨運成本的降低？對你們來說，供應鏈正常化有什麼樣的動力？您可以根據目前的開始情況來充實第二季的情況。

Yes. So as I said, in Q1, it was inflation and FX, and it was probably a little bit more FX favorability than deflation. And really, what we're seeing is we're seeing a little bit of an uptick on inflation relative to freight because freight costs are going up. We're seeing a little bit of deflation on utilities. So utilities are a little bit better. And then materials are a little bit up and down. Some things are better and some things are worse. But it's really at the end of the day, it's maybe 20 bps. And so it's really not that big of a deal. We're just seeing kind of a stabilization of things across the board.

是的。正如我所說，在第一季度，主要是通貨膨脹和外匯，而且外匯的有利程度可能比通貨緊縮要高一些。實際上，我們看到的是，由於運費上漲，通貨膨脹相對於運費略有上升。我們看到公用事業出現了一些通貨緊縮。所以公用事業要好一點。然後材料有一點上下。有些事情更好，有些事情更糟。但最終確實是這樣，可能是 20 個基點。所以這真的沒什麼大不了的。我們只是看到事情全面穩定。

That's helpful. And then in terms of in your conversations with your distributors as you get ready to set expectations for pricing in 2025. Can you just talk about conceptually how are you thinking about normalized inflation going forward, considering the outsized inflation we've seen over the next couple of years, as you set the initial expectations on what distributors should expect '25?

這很有幫助。然後，當您準備設定2025 年的定價預期時，在與經銷商的對話中。到的超額通膨幾年來，當您設定了經銷商對 25 年應該期待什麼的最初期望時？

Well, 2025 is a long way away, Jerry. So I'm not going to trying to predict what's going to happen that far out. I can tell you a couple of things. One is we're always going to be able to, we believe, get price to offset the inflationary pressures we've seen, right? Even with the extraordinary inflation that we saw over the past 3 years, we were able to get EBITDA margin neutrality with our pricing.

好吧，2025 年還很遙遠，傑瑞。所以我不會試著預測那麼遠的將來會發生什麼事。我可以告訴你幾件事。一是我們相信，我們總是能夠透過價格來抵銷我們所看到的通膨壓力，對嗎？即使過去三年我們經歷了非同尋常的通貨膨脹，我們仍然能夠透過我們的定價獲得 EBITDA 利潤率中立。

In addition, as we continue to work through 80/20. We're going to be more strategic around some of the pricing things that we do in terms of using the 80/20 tools to do the best we can relative to pricing. And then we'll look at what's going on with materials. We'll look at what's going on with freight. We'll look at what's going on with utilities. And then we'll make that judgment when we get to 2025.

此外，隨著我們繼續努力完成80/20。我們將在一些定價方面採取更具策略性的做法，即使用 80/20 工具在定價方面做到最好。然後我們會看看材料發生了什麼。我們將看看貨運情況。我們將看看公用事業公司的情況。到 2025 年我們才會做出判斷。

And what kind of lead time do you need to provide?

您需要提供什麼樣的交貨時間？

Typically 2 to 3 months.

通常為 2 至 3 個月。

Your next question comes from the line of Damian Karas of UBS.

你的下一個問題來自瑞銀集團的達米安卡拉斯。

Good morning, everyone. Thanks for all the thoughts on the guidance and your pragmatic approach to the margins as the year progresses. I, maybe, just take a step back, ask you a little bit about potential growth drivers. Data centers is obviously very topical right now. I know you guys have mentioned you've got capabilities in this space. I was wondering if there's any numbers or thoughts you could share around activity you've been seeing and just that opportunity more generally. And I'm presuming we'd see any such activity kind of show up in your industrial First Fit category?

大家，早安。感謝您對指導的所有想法以及您在這一年中對利潤的務實態度。也許我只是退一步，問你一些關於潛在成長動力的問題。資料中心現在顯然是非常熱門的話題。我知道你們已經提到你們在這個領域有能力。我想知道您是否可以分享有關您所看到的活動以及更廣泛的機會的任何數字或想法。我想我們會看到任何此類活動出現在您的工業“First Fit”類別中？

Yes. Sure, Damian. I think as we stated during the CMD about a month ago, 5 weeks ago, we view the data center as an emerging rather significant opportunity to drive incremental growth to the next 3 to 4 years. We have a reasonably decent portfolio to be able to participate with our electric water pumps and with our fluid conveyance products. That being said, we are also in process of launching fully refreshed fluid conveyance product that's specifically going to target the data center applications that is more tailored for what's needed in those particularly hyperscale data centers.

是的。當然，達米安。我認為，正如我們在大約一個月前、五週前的 CMD 會議上所說，我們將資料中心視為一個新興的相當重要的機會，可以推動未來 3 到 4 年的增量成長。我們擁有相當不錯的產品組合，能夠參與我們的電動幫浦和流體輸送產品。話雖如此，我們也正在推出完全更新的流體輸送產品，該產品專門針對資料中心應用程序，更適合那些特別是超大規模資料中心的需求。

So I wouldn't anticipate that we're going to see a meaningful ramp-up in 2024. But I would say that there should be an expectation that we start talking more about it in '25 and as we go into '26. As you know, these projects are specked early in and the revenue ramp-up takes some time as these data centers get built out. So that's kind of how I would say you should think about it.

因此，我預計我們不會在 2024 年看到有意義的成長。如您所知，這些項目是很早就計劃好的，隨著這些資料中心的建成，收入的成長需要一些時間。所以我想說你應該考慮一下。

And as to the other drivers I would certainly say that we still feel extremely constructive about our chain-to-belt initiative and as particularly the end markets are stabilizing particularly on the mobility side, as I said in my prepared remarks, so I think Brooks may have said that, we now anticipate that the personal mobility destock should play itself out in the first half of this year. And while we don't expect any hockey stick type recovery in personal mobility space, we do believe that in the second half, the market is going to be more constructive. And then in 2025, we should start seeing really nice uptick again in our growth rates in personal mobility, lots of projects we're involved across a very significant number of design wins, so we are quite constructive on that.

至於其他驅動因素，我當然會說，我們仍然對我們的「鏈到帶」計劃非常有建設性，特別是終端市場正在穩定，特別是在移動方面，正如我在準備好的講話中所說，所以我認為布魯克斯也許有人說過，我們現在預計個人出行去庫存應該會在今年上半年發揮作用。雖然我們預計個人移動領域不會出現曲棍球棒式復甦，但我們確實相信下半年市場將更具建設性。然後到 2025 年，我們應該會開始看到個人移動性成長率再次出現非常好的上升，我們參與的許多項目都贏得了大量的設計，所以我們對此非常有建設性。

And then as we have been demonstrating, we are doing a rather good job in the automotive replacement side of our business, and we still believe that there are some positive drivers of the midterm and that should be constructive for us. So we do have lots of factors to continue to drive growth in the future. But that being said, I would ground everybody in, we need to start seeing some stability in the underlying market environment, which we believe we should start seeing into the second half of this year.

正如我們一直在證明的那樣，我們在汽車更換方面做得相當好，我們仍然相信中期存在一些積極的推動因素，這對我們來說應該是有建設性的。因此，我們確實有許多因素可以繼續推動未來的成長。但話雖這麼說，我想讓大家知道，我們需要開始看到基礎市場環境的穩定性，我們相信我們應該在今年下半年開始看到這種情況。

Okay. Great. That makes sense. And then could you just maybe elaborate a little bit on your expectations for China. I know you said still choppy trends, but it was nice to see kind of the positive growth inflection. So what makes you think you can't kind of just continue to grow from here and just maybe talk about what's giving you a little hesitation and the expected choppiness.

好的。偉大的。這就說得通了。然後您能否詳細說明一下您對中國的期望。我知道你說趨勢仍然不穩定，但很高興看到積極的成長轉折點。那麼，是什麼讓你認為你不能從這裡繼續成長，也許只是談論什麼讓你有點猶豫和預期的波動。

Look, again, I would say, more of a pragmatic view of what is happening. I would say that fundamentally, there are still lots of headwinds in that economy. We are growing really nicely. Our automotive replacement business in China despite of those headwinds. We start seeing that particularly in the industrial replacement side, it's becoming less bad. In China. So one could anticipate some degree of inflection into second half of the year there.

我想說，再看一下，對正在發生的事情採取更務實的看法。我想說，從根本上來說，該經濟仍然存在許多阻力。我們成長得非常好。儘管存在這些阻力，我們在中國的汽車更換業務。我們開始看到，特別是在工業替代方面，情況正在變得不那麼糟糕。在中國。因此，人們可以預期下半年會出現某種程度的變化。

Commercial construction is stabilizing. So I mean you could count to conclusions that things are getting better, but they're also choppy. And I would say that our Q2 comp in China, in particular, is going to be challenging because there was the best quarter in China that we had last year. So while the underlying market environment maybe stabilizing or is stabilizing, again, we just try to be pragmatic rather than getting way over our skis here.

商業建設趨於穩定。所以我的意思是，你可以得出結論，情況正在好轉，但也不穩定。我想說，我們在中國的第二季業績尤其具有挑戰性，因為去年我們在中國經歷了最好的季度。因此，雖然潛在的市場環境可能正在穩定或正在穩定，但我們只是嘗試務實，而不是在這裡超越我們的滑雪板。

Your next question comes from the line of Andy Kaplowitz of Citigroup.

你的下一個問題來自花旗集團的安迪·卡普洛維茨。

Brooks, I just want to start out with free cash flow. You start out the year negative, which seasonally is not -- is kind of normal. But last year, I think you had positive free cash flow. So can you maybe discuss what happened in the quarter? I know you didn't change the outlook for the year. So should you turn to a nice cash in Q2?

布魯克斯，我只想從自由現金流開始。你以負數開始了這一年，這在季節性上並不是——這是正常的。但去年，我認為你們有正的自由現金流。那麼您能否討論一下本季發生的事情？我知道你沒有改變今年的前景。那麼你應該在第二季轉向大量現金嗎？

Yes. Well, I mean, I think last year was more of the outlier and this year is more of a return to normal. And so we build inventory through Q1 and Q2 because that's typically a little bit busier. And then also we had more variable comp payout in Q1 of this year. So that was a pretty significant year-over-year change, and that also impacted Q1 of this year. But I would say Q1 of this year was much more normalized than Q1 of last year.

是的。嗯，我的意思是，我認為去年更多的是異常情況，而今年更多的是回歸正常。因此，我們在第一季和第二季建立庫存，因為這通常會比較忙。今年第一季我們也有更多可變補償支出。因此，這是一個相當重大的年比變化，也影響了今年第一季。但我想說，今年第一季比去年第一季更正常化。

Okay. And then Ivo, I just want to follow up on diversified industrial and personal mobility. What is driving diversified industrial stabilization? And then you kind of mentioned in the previous question, you think personal mobility gets better in the second half. What kind of run rate does it have to get to? Because I think at the Investor Day, you talked about potentially double-digit growth in '25. So what's the visibility toward that sort of inflection in personal mobility?

好的。然後，伊沃，我只想跟進多元化的工業和個人流動性。是什麼推動多元化產業穩定？然後你在上一個問題中提到，你認為下半年個人流動性會更好。它必須達到什麼樣的運作率？因為我認為在投資者日，您談到了 25 年潛在的兩位數成長。那麼，個人流動性的這種變化的可見度如何呢？

Look, so the personal mobility was impacted over the last 5 or 6 quarters, particularly by the destock and the over bills during the COVID era. What we are starting to see now is you're starting to see some real inflection, I think, in the market demand. Look, we haven't seen order expedites in a very long time. You're now starting to see customers kind of calling you and saying, "Oh, please, could you please expedite this order for me?" And that will give you an indication that we are kind of approaching the through of the inventory destock.

看，個人流動性在過去五六個季度受到了影響，特別是受到新冠疫情期間的去庫存和超額賬單的影響。我認為，我們現在開始看到的是，您開始看到市場需求出現一些真正的變化。看，我們已經很久沒有看到訂單加急了。您現在開始看到客戶打電話給您並說：“哦，拜託，您能幫我加快這個訂單嗎？”這將向您表明我們即將完成庫存去庫存。

And if you take a look at the underlying market build, so the end unit builds, they stabilized. So as we are looking on a forward-going basis, we believe that the channel destock is kind of coming to an end, and we should see Q2 being the bottom of it. And then because there is a more stabilizing end market demand in the personal mobility space, we believe that we'll start slow and steady recovery with perhaps more normalization as we get into 2025.

如果你看一下基礎市場的構建，最終單位的構建，它們就會穩定下來。因此，當我們展望未來時，我們認為渠道去庫存即將結束，我們應該看到第二季度是其底部。然後，由於個人出行領域的終端市場需求更加穩定，我們相信，進入 2025 年，我們將開始緩慢而穩定的復甦，並可能更加正常化。

Now what gives us a degree of confidence that we will start seeing some of the growth rates that we were discussing at the CMD. Look, we continue to grab quite a bit of share in conversions. They do take time to ramp up as the new equipment is being built and being offered for sale in the season that this is usual. So we actually feel quite positively that we have reached the bottom in the personal mobility in the first half of this year.

現在，是什麼讓我們有一定程度的信心，我們將開始看到我們在 CMD 上討論的一些成長率。看，我們繼續在轉換中佔據相當大的份額。由於新設備正在建造並在通常的季節出售，因此它們確實需要時間來提升。因此，我們實際上非常積極地認為，今年上半年我們的個人流動性已經觸底。

Now on the industrial replacement side. Look, things are just last bad. I wouldn't let you read my words as things off to the races. But all of the indicators are pointing towards more stabilizing demand. Reasonably a positive broad improvement or reduction of negative order rates that we have seen for 3 or 4 quarters there in industrial replacement. So we believe that this is on a trajectory of kind of a steady recovery very much in line with what, frankly, the industrial PMI is telling you is just getting less bad, so it will mirror the performance of the indices.

現在在產業替代方面。看，事情只是變得糟糕。我不會讓你把我的話當成比賽的事情。但所有指標都顯示需求更加穩定。我們在三、四個季度中看到工業替代率出現了積極的廣泛改善或負訂單率的下降。因此，我們認為，這正處於穩定復甦的軌道上，坦白說，工業採購經理人指數告訴你的情況正在變得不那麼糟糕，因此它將反映指數的表現。

Your next question comes from Julian Mitchell of Barclays.

你的下一個問題來自巴克萊銀行的朱利安·米切爾。

Maybe Ivo just going back to your point on the sort of the broad environment in industrial. Because I guess at the Investor Day, it felt like things were sort of getting better, maybe more quickly and then maybe the tone, it seems a little bit more balanced or measured today. Is that a fair sort of characterization? Did you see any notable slowdown or change in trend in the last month or 2. And again, I totally understand it's a very uneven environment. We see that just less than an hour ago with the PMI going back below 50 again and also on new orders. So that's just the nature of the environment, but just wondered was there any particular region or market that you feel a little more tepid on now versus the CMD?

也許伊沃只是回到你關於工業大環境的觀點。因為我想在投資者日，感覺事情正在變得更好，也許更快，然後也許基調，今天似乎有點更加平衡或謹慎。這是一種公平的表徵嗎？在過去一兩個月裡，您是否看到任何明顯的放緩或趨勢變化。就在不到一個小時前，我們看到 PMI 再次回到 50 以下，新訂單也是如此。這就是環境的本質，但我想知道是否有任何特定的地區或市場讓您感覺與 CMD 相比更加不溫不火？

Yes. Look, one of the things that I would point out, while we anticipated that the Easter holiday was coming in into March, which was a little bit earlier than it was prior years. We have seen a little more choppiness at the second half of that month. And I would say that it was -- the weaker performance was reasonably muted. I mean it was less than half a day of sales. If you kind of want to kind of scope it, what was the impact. And I would more associate that with the Easter coming in earlier.

是的。看，我要指出的一件事是，雖然我們預計復活節假期將在三月到來，這比往年要早一些。該月下半月我們看到了更多的波動。我想說的是──較弱的表現相當平淡。我的意思是，銷售時間還不到半天。如果您想要確定其範圍，那麼影響是什麼。我更願意將其與復活節提前到來聯繫起來。

And then -- but on the other hand, I would say that some of the off-highway builds are getting weaker. And I would anticipate that that's going to continue to be a headwind into kind of the rest of the year. I don't anticipate that ag is going to be recovering in my sense is that the commercial construction equipment space is going to be somewhat challenged as well. But that probably is going to be offset by more constructive AR, more constructive IR, some recovery in personal mobility in the second half.

然後 - 但另一方面，我想說一些非公路建築正在變得越來越弱。我預計這將繼續成為今年剩餘時間的阻力。我認為農業不會復甦，因為商業建築設備領域也會受到一定的挑戰。但這可能會被更具建設性的 AR、更具建設性的 IR 以及下半年個人流動性的一些復甦所抵消。

So I wouldn't say, Julian, that anything has really changed. I would just say that March maybe came in half a rate below what we've kind of anticipated that we are going to see. And again, I would probably say it's more on the back of that Easter holiday coming in a little bit earlier than prior year and probably impacting us well more than what we've anticipated.

所以，朱利安，我不會說任何事情都真的改變了。我只想說，三月的成長率可能比我們預期的低一半。再說一次，我可能會說，這更多是因為復活節假期比去年提前了一點，對我們的影響可能比我們預期的要大得多。

That's helpful. Thank you, Ivo. And then a more project question maybe for Brooks around tax rate. Clearly, that increase has sort of offset the higher EBITDA margin guide for this year. So is it sort of a 25% type tax rate in the adjusted P&L for the year? And when we think about beyond 2024 does the tax rate we should use? Is that more like the sort of low 20s type range?

這很有幫助。謝謝你，伊沃。然後布魯克斯可能會問一個關於稅率的更多項目問題。顯然，這一增長在一定程度上抵消了今年較高的 EBITDA 利潤率指引。那麼，該年度調整後的損益表中的稅率是否為 25%？當我們考慮 2024 年之後我們應該使用什麼稅率？這更像是 20 多歲以下的類型嗎？

Yes. So yes, I think for the year, we've seen -- we had these discrete items. And as I said in my remarks, largely, they're going to be offset. What we are seeing, too, is a little bit of a tick up in our statutory tax rate based on the mix of income in the jurisdictions that are coming in from. And so that's a little bit of an uptick for the year. I think going forward, 22% to 25% is going to be in this range. And it's going to be impacted, again, like I said, by the mix of income and where it's coming in. And then obviously, there's other things going on with the pillar tax and different things like that, that may affect it a little bit here and there. But '22 is '25 where we think we ought to be kind of for the midterm.

是的。所以，是的，我認為今年我們已經看到了——我們有這些離散的項目。正如我在演講中所說，很大程度上，它們將被抵消。我們也看到，根據來自司法管轄區的收入組合，我們的法定稅率略有上升。所以今年這個數字略有上升。我認為未來 22% 到 25% 將在這個範圍內。正如我所說，它將再次受到收入組合及其來源的影響。但是'22'是'25'，我們認為我們應該在中期選舉中做到這一點。

Your next question comes from the line of Mike Halloran of Baird.

您的下一個問題來自貝爾德 (Baird) 的 Mike Halloran。

So I just kind of want to put all these pieces together here. Because a lot of markets, a lot of different trend lines. If you net it together, is the guidance more or less assuming stability in relatively normal sequentials for your overall business for the remainder of the year?

所以我只是想把所有這些片段放在一起。因為有很多市場，有很多不同的趨勢線。如果將其綜合起來，該指引是否或多或少假設今年剩餘時間您的整體業務在相對正常的情況下保持穩定？

Yes, I think that that's the right way to think about it, Mike. I think that stabilizing demand is probably the right way to think about that with some puts and some takes, right? So of highway, maybe weaker and some of the other segments may be performing a little bit better AR, IR recovering. So that's a good way to think about it, puts and takes and more stability.

是的，我認為這是正確的思考方式，麥克。我認為穩定需求可能是考慮一些看跌期權和一些看跌期權的正確方法，對嗎？因此，高速公路可能較弱，而其他一些路段的 AR、IR 恢復可能會表現得更好一些。所以這是一個很好的思考方式，放置和取出以及更多的穩定性。

And then could you provide an update on the operational improvement initiatives internally, probably a little bit more geared towards how the organization and teams are accepting it and how quickly you think you can start seeing some significant benefits. I know we just had the Analyst Day not that long ago. So more curious about the internal momentum and how the adoption curve is going?

然後您能否提供有關內部運營改進計劃的最新信息，可能更適合組織和團隊如何接受它以及您認為您可以多快開始看到一些顯著的好處。我知道不久前我們剛剛度過了分析師日。那麼對內部動力以及採用曲線的走向更加好奇嗎？

Yes. I think it's a great question. Thank you for asking that, Mike. Look, we're doing better. I think that the organization is much more comfortable and much more confident in its ability to execute on the vision that we have set in the targets and on the internal expectation. I would say that if you're thinking about that, right, we've really not upgraded or updated our revenue guidance for the year. But at the midpoint, we have taken up our EBITDA margin guidance rather nicely, and we are forecasting that will continue to see gross margin improvements, which will drive the EBITDA margin improvement in a lower volume environment.

是的。我認為這是一個很好的問題。謝謝你這麼問，麥克。看，我們做得更好了。我認為，該組織對其執行我們在目標和內部期望中設定的願景的能力更加放心和充滿信心。我想說，如果你正在考慮這個問題，對吧，我們確實沒有升級或更新今年的收入指引。但在中期，我們已經很好地接受了 EBITDA 利潤率指導，我們預測毛利率將繼續改善，這將在銷售較低的環境中推動 EBITDA 利潤率的改善。

And so we are executing quite well. We are doing probably slightly better than what we've anticipated at the beginning of the year. Some things are happening right as we've anticipated. And if you think about it, we're going to be delivering in 2024 kind of margin performance, both on the EBITDA and gross margin level kind of at historical high during an end market of volume drop. So that's providing us with a very positive setup as we enter a more constructive volume environment kind of in the '25 and '26.

所以我們執行得很好。我們的表現可能比年初的預期稍好。有些事情正在按照我們的預期發生。如果你仔細想想，我們將在 2024 年實現利潤率表現，無論是 EBITDA 還是毛利率水平，在終端市場銷量下降期間都處於歷史高位。因此，當我們在 25 年和 26 年進入更具建設性的成交量環境時，這為我們提供了非常積極的設置。

So we are laser-focused on executing on our '26 commitments to our shareholders. We made good progress. And based upon where I sit today and what I see from the organizational execution, I would feel much more confident that we're going to be highly capable to deliver on that objective that we set out at the CMD.

因此，我們專注於履行對股東的 26 年承諾。我們取得了良好的進展。根據我今天的立場以及我從組織執行中看到的情況，我會更有信心，我們將非常有能力實現我們在 CMD 上設定的目標。

Your next question comes from Deane Dray of RBC Capital Markets.

您的下一個問題來自加拿大皇家銀行資本市場的 Deane Dray。

Thank you. Good morning, everyone. Maybe just want to circle back. There's been a lot of discussion about he tone of business and stabilizing demand and so forth. And you've given lots of good color there. And just maybe, if you can make a distinction between the demand on aftermarket versus First Fit.

謝謝。大家，早安。也許只是想繞回來。關於業務基調和穩定需求等問題有很多討論。你在那裡提供了很多好的色彩。如果你能區分售後市場和 First Fit 的需求，也許是可能的。

And just the idea, when you look at the slides, you're down First Fit Industrial in both segments and also down First Fit Industrials, North America and EMEA. So just maybe you have to dig deeper into the individual verticals, ag, commercial construction and so forth. And just saying First Fit is not specific enough. But just how do you reflect on the First Fit all being down at this stage in a stabilizing environment?

只是這個想法，當您查看投影片時，您會發現 First Fit Industrial 在這兩個細分市場中都處於下降趨勢，而且 First Fit Industrials 在北美和歐洲、中東和非洲地區也處於下降趨勢。因此，也許您必須更深入地研究各個垂直行業、農業、商業建築等。僅僅說「First Fit」還不夠具體。但是，您如何看待現階段在穩定的環境中 First Fit 的表現？

I would say that the First Fit is predominantly impacted by ag, commercial construction and personal mobility. Those 3 verticals are driving, I would say, 95% of the First Fit performance, while the replacement business is up low single digits globally. And I would say that, that's driven by a very, very solid performance in AI in the automotive replacement side. So up mid-single digits and stabilizing performance in the industrial replacement, which is down, I would say, low single digits.

我想說，第一適應度主要受到農業、商業建築和個人流動性的影響。我想說，這 3 個垂直領域推動了 First Fit 業績的 95%，而全球替換業務的成長幅度僅為個位數。我想說，這是由汽車更換方面人工智慧非常非常穩定的表現所推動的。因此，工業替代品的成長達到中個位數並穩定表現，而我想說的是，工業替代品的表現下降了低個位數。

So you're right, you need to take a look at the puts and takes. And if you recall what I stated, I believe that the off-highway is going to continue to be a headwind throughout the year. But I also believe that we can maintain strong performance in automotive replacement and that we will start seeing improving trends as we work through the year in the industrial replacement side of our business.

所以你是對的，你需要看看看跌期權和索取期權。如果你還記得我說過的話，我相信非公路將繼續成為全年的逆風。但我也相信，我們可以在汽車替代方面保持強勁的表現，隨著我們全年在工業替代方面的工作，我們將開始看到改善的趨勢。

Great. That's helpful. And then I might have missed it, but when you talked about cadence in the quarter, how did April start off? And did you -- any of that Easter holiday early impacted, was that recouped noticeably in April?

偉大的。這很有幫助。然後我可能錯過了，但是當您談到本季度的節奏時，四月是如何開始的？復活節假期是否受到提前影響，四月是否明顯恢復？

So the March month was not really impacted from an order intake on the Easter holiday side. It was more the shipments that were more impacted in Europe, particularly Europe and North America, think about it again, maybe half a day of sales. It wasn't significant, but we came a shade under what we have anticipated at the midpoint at the CMD.

因此，三月並沒有真正受到復活節假期訂單量的影響。更多是歐洲的出貨量受影響比較大，特別是歐洲和北美，再想想，可能是半天的銷售量。這並不重要，但我們在 CMD 中點的預期略低於我們的預期。

In April, look, we continue to see choppiness. Again, I will probably repeat myself commercial construction, ag, IR came in kind of as we anticipated, steadily improving, no hockey stick improvement. AR remains solid. So continuation of what we have seen. So the market environment is choppy. That's the best way to describe it. You can have several weeks in a row that are very good, and then you may have a very week of order intakes and shipments. So it's pretty much playing itself out as we are anticipating in our forecast for Q2.

4月份，我們繼續看到波動。再次，我可能會重複自己的商業建築，ag，IR 正如我們預期的那樣，穩步改進，沒有曲棍球棒改進。 AR 依然穩固。所以我們所看到的繼續。所以市場環境是動盪的。這是描述它的最好方式。你可以連續幾週都表現得很好，然後你可能會有一周的訂單接收和發貨。因此，正如我們在第二季的預測中所預期的那樣，它幾乎正在發揮作用。

Your next question comes from the line of David Raso of Evercore.

你的下一個問題來自 Evercore 的 David Raso。

Just a couple of quick cleanups. I don't think I heard a currency guide for the year. I'm just curious where your head is on currency now for the year?

只需進行幾次快速清理即可。我想我沒有聽到今年的貨幣指南。我只是好奇你今年對貨幣的看法如何？

Well, we don't really forecast currency, David. I mean we just take the current rates and we use those for the balance of the year. And so I mean, I'm not going to try to predict what's going to happen with FX, that's for sure. So that's how we look at that. So whatever the prevailing rates are when we kind of put roll up our forecast, that's what we use for the balance of the year.

好吧，我們並沒有真正預測貨幣，大衛。我的意思是，我們只採用當前匯率，並在今年剩餘時間內使用這些匯率。所以我的意思是，我不會試圖預測外匯會發生什麼，這是肯定的。這就是我們的看法。因此，無論當前的利率是多少，當我們匯總我們的預測時，這就是我們在今年剩餘時間內使用的利率。

I mean, given it was slightly negative in the first quarter, it was a drag. Is it just safe to assume that it's a little bit of a drag for the year? I mean obviously we don't want to...

我的意思是，考慮到第一季的業績略有下降，這是一個拖累。可以肯定地說，今年的情況會有點拖累嗎？我的意思是顯然我們不想...

It's a drag through the first 3 quarters, and then it kind of gets positive towards the end of the year, but it's a drag overall for the year, about 30 bps from the top line perspective.

前三個季度是一個拖累，然後到年底時會變得積極，但全年總體來說是一個拖累，從營收角度來看大約是 30 個基點。

Okay. The footprint optimization, can you give us a quick update where we stand with those? And which are the ones that particularly when they get across the finish line should make a difference?

好的。足跡優化，您能給我們快速更新我們的立場嗎？哪些是特別是當他們衝過終點線時應該會產生影響的？

Well, we have not quantified those. So the CMD, as you know, we have a number of projects that are ongoing, and we will update you at the time of completion, just like we did in China, with our China project last year. But I would not think about substantial benefits until latter part of '25, early '26.

好吧，我們還沒有量化這些。所以，正如你所知，CMD，我們有許多項目正在進行中，我們將在完成時向你通報最新情況，就像我們去年在中國所做的那樣。但直到 25 世紀末、26 年初我才會考慮實質的好處。

Okay. And then lastly, I think you said not just book-to-bill above 1, but actually orders up year-over-year, right? I know the revenue is down. So book-to-bill can be above 1 and order is still down. But I heard you correctly, you said your orders are actually up as a company year-over-year in the first quarter. Is that correct?

好的。最後，我認為您所說的不僅僅是訂單出貨比高於 1，而且實際上訂單逐年增加，對嗎？我知道收入下降了。因此，訂單出貨比可能會高於 1，而訂單量仍然下降。但我沒聽錯，你說公司第一季的訂單實際上比去年同期成長。那是對的嗎？

That's correct.

這是正確的。

So the idea of organic being down 3.5% in 2Q, I mean, obviously, I don't think of you as a long lead time company. It just goes back to your comment. Maybe the orders were up in the first quarter, but it's choppy enough. We can't count on converting up orders in 1Q into even flat organic for the quarter? I mean is that sort of the idea like the orders are moving around enough week to week. It's just sort of a workaround right now...

因此，有機產品在第二季度下降 3.5% 的想法，我的意思是，顯然，我不認為你們是一家交貨時間長的公司。它只是回到你的評論。也許第一季的訂單增加，但也夠不穩定的了。我們不能指望將第一季的訂單轉化為該季度的有機訂單嗎？我的意思是像訂單每週都在變化的想法。現在這只是一種解決方法...

Yes, Dave, I think that that's the right way to think about it. Look, some of the outperformance in Q1 versus prior year has been driven by some of the longer cycle projects, I think oil and gas and mining, that will fill in '24 over the next 2 to 3 quarters. Half of the outperformance was driven just simply through the shorter cycle businesses but then you kind of see incrementally a little more weakness in ag and commercial construction. So we're just trying to balance that out.

是的，戴夫，我認為這是正確的思考方式。看起來，第一季與去年相比的一些優異表現是由一些較長週期的項目推動的，我認為石油、天然氣和採礦業將在未來 2 到 3 個季度填補 24 年的空白。一半的優異表現只是透過較短週期的業務推動的，但隨後你會逐漸看到農業和商業建築領域的疲軟。所以我們只是想平衡這一點。

And again, I'll restate it we believe that the end market environment is stabilizing, but we are not prepared to declare a victory and say, "Hey, there's an inflection." And we anticipated now that will meaningfully impact our ability to deliver top line growth above what we are envisaging at this point in time. Again, it's early. We are off to a very good start and we believe that the backdrop is a little more positive, but we are very pleased with where we sit presently.

我再次重申，我們相信終端市場環境正在穩定，但我們不准備宣布勝利並說：“嘿，有一個拐點。”我們現在預計，這將對我們實現營收成長超出目前預期的能力產生重大影響。再說一遍，時間還早。我們有了一個非常好的開始，我們相信背景會更加積極一些，但我們對目前的情況非常滿意。

And while I have one quick one. The interest expense, I know you used your revolver a lot in '23 so that not repeating should enable right your interest expense to be down. But the first quarter did come in even a little lower than I thought. Can you give us some help with how you're thinking about the full year interest expense?

雖然我有一個快速的。利息費用，我知道您在 23 年經常使用左輪手槍，因此不重複應該可以使您的利息費用下降。但第一季的業績確實比我想像的還要低。您能否為我們提供一些幫助，幫助我們了解您如何看待全年利息支出？

Yes. I mean it is going to be down year-over-year. We're thinking about $150 million interest expense, GAAP interest expense for the year.

是的。我的意思是它會逐年下降。我們正在考慮 1.5 億美元的利息支出，以 GAAP 計算，本年度的利息支出。

There are no further questions at this time. I will now turn the conference back to Rich Kwas for closing remarks.

目前沒有其他問題。現在我將請里奇·誇斯 (Rich Kwas) 致閉幕詞。

All right. Thank you, everyone, for joining. If you have any further questions, feel free to reach out. And otherwise, have a great rest of the week. Thank you.

好的。謝謝大家的加入。如果您還有任何疑問，請隨時與我們聯繫。除此之外，本週好好休息。謝謝。

Thank you. That does conclude our conference for today. Thank you all for joining. You may now disconnect.

謝謝。我們今天的會議到此結束。感謝大家的加入。您現在可以斷開連線。