Knowles Corp (KN) 2024 Q3 法說會逐字稿

At this time, I'd like to welcome everyone to the Knowles Corporation third-quarter 2024 earnings conference call. Please note that this call is being recorded. (Operator Instructions)

現在，我歡迎大家參加樓氏公司 2024 年第三季財報電話會議。請注意，此通話正在錄音。（操作員說明）

I will now turn the call over to Sarah Cook.

我現在將把電話轉給莎拉·庫克。

Thank you and welcome to our third-quarter 2024 earnings call. I am Sarah Cook, Vice President of Investor Relations and presenting with me today are Jeffrey Niew, our President and CEO; and John Anderson, our Senior Vice President and CFO.

感謝並歡迎參加我們的 2024 年第三季財報電話會議。我是投資者關係副總裁莎拉庫克 (Sarah Cook)，今天與我一起出席的是我們的總裁兼執行長 Jeffrey Niew；以及我們的高級副總裁兼財務長約翰·安德森 (John Anderson)。

Our call today will include remarks about future expectations, plans, and prospects for Knowles which constitute forward-looking statements for purposes of the Safe Harbor provisions under applicable federal security laws. Forward-looking statements in this call will include comments about demand for company products, anticipated trends in company sales expenses and profits, and involve a number of risks and uncertainties that could cause actual results to differ materially from current expectations.

我們今天的電話會議將包括有關樓氏集團未來預期、計劃和前景的評論，這些評論構成適用聯邦安全法下安全港條款的前瞻性陳述。本次電話會議中的前瞻性陳述將包括有關公司產品需求、公司銷售費用和利潤的預期趨勢的評論，並涉及許多可能導致實際結果與當前預期存在重大差異的風險和不確定性。

The company urges investors to review the risks and uncertainties in the company's SEC filings, including but not limited to, the annual report on Form 10-K for the fiscal year ended December 31, 2023. Periodic reports filed from time to time with the SEC, and the risks and uncertainties identified in today's earnings release.

該公司敦促投資者審查該公司向 SEC 提交的文件中的風險和不確定性，包括但不限於截至 2023 年 12 月 31 日的財政年度 10-K 表格年度報告。不時向美國證券交易委員會提交的定期報告，以及今天的收益報告中確定的風險和不確定性。

All forward-looking statements are made as of the date of this call, and Knowles disclaims any duty to update such statements except as required by law. In addition, pursuant to [Reg G] any non-GAAP financial measures referenced during today's conference call can be found in our press release posted on our website at knowles.com, and in our current report on Form 8-K filed today with the SEC. This will include a reconciliation to the most directly comparable GAAP measure.

所有前瞻性陳述均截至本次電話會議之日作出，除法律要求外，Knowles 不承擔任何更新此類陳述的義務。此外，根據 [Reg G]，今天電話會議期間引用的任何非 GAAP 財務指標均可在我們網站 Knowles.com 上發布的新聞稿以及今天向本公司提交的 8-K 表格當前報告中找到。委員會。這將包括與最直接可比較的公認會計準則衡量標準的調節。

All financial references on this call will be in a non-GAAP continuing operations basis unless otherwise indicated. We've made selected financial information available in webcast slides which can be found in the Investor Relations section of our website.

除非另有說明，本次電話會議的所有財務參考均以非公認會計準則持續經營為基礎。我們在網路廣播幻燈片中提供了精選的財務訊息，這些資訊可以在我們網站的投資者關係部分找到。

With that, let me turn the call over to Jeff who will provide details on our results. Jeff?

接下來，讓我將電話轉給傑夫，他將提供有關我們結果的詳細資訊。傑夫？

Thanks, Sarah, and thanks to all of you for joining us today. Before I move on to the results in detail, I would like to remind you that all financial metrics given on today's call are on a continued operations basis unless otherwise noted as we signed a definitive agreement in Q3 to sell the consumer MEMS microphone business.

謝謝莎拉，也謝謝大家今天加入我們。在詳細介紹結果之前，我想提醒您，今天電話會議上給出的所有財務指標均以持續運營為基礎，除非另有說明，因為我們在第三季度簽署了出售消費MEMS 麥克風業務的最終協定.

The sale will further our strategy of transitioning the company's portfolio to higher growth markets and products where we have differentiated solutions that drive value for both our customers and shareholders. This positions knows for strong growth in both revenue and earnings in the future.

此次出售將進一步推動我們將公司的產品組合轉向更高成長的市場和產品的策略，在這些市場和產品中，我們擁有差異化的解決方案，為我們的客戶和股東帶來價值。該職位未來的收入和利潤將強勁增長。

As demonstrated by our third-quarter results, our total company adjusted EBITDA margins were 24.6% and as market conditions improved in the PD segment and we realize the full benefit of synergies from the Cornell acquisition. I expect additional margin expansions.

正如我們第三季的業績所證明的那樣，我們公司調整後的 EBITDA 利潤率為 24.6%，隨著 PD 領域市場狀況的改善，我們實現了收購康乃爾大學的協同效應的全部好處。我預計利潤率會進一步擴大。

Now turning to our results. We continue to deliver on expectations in the third quarter. Revenue of $143 million was at the high end of our guided range, which represents 32% growth on a year-over-year basis driven by the Cornell acquisition along with 4% organic growth. EPS of $0.26 was at the midpoint of our guided range, while cash from operations was $53 million inclusive of CMM, exceeding the high end of our guided range.

現在轉向我們的結果。我們第三季持續實現預期。1.43 億美元的營收處於我們指引範圍的高端，在收購康乃爾大學的推動下，年增 32%，有機成長 4%。每股收益 0.26 美元處於我們指導範圍的中點，而營運現金為 5,300 萬美元（包含 CMM），超過了我們指導範圍的高端。

On to our segment. In Q3 medtech specialty audio revenue grew 4% sequentially and 10% on a year over year basis. Our continued operational excellence, sustained success of new product adoption, and cutting-edge technology is evidenced by our growth and strong margins. The end market for caring health products remain strong and we're optimistic about our future.

進入我們的部分。第三季度，醫療技術專業音訊收入較上季成長 4%，較去年同期成長 10%。我們的成長和強勁的利潤證明了我們持續的卓越營運、新產品採用的持續成功以及尖端技術。保健品終端市場依然強勁，我們對未來持樂觀態度。

In Q3, Apple announced software updates that add over the counter hearing aid features to the AirPod pro 2. Over the counter hearing aids address mild hearing loss, which is the least penetrated portion of the hearing health market.

第三季度，蘋果宣布了軟體更新，為 AirPod pro 2 添加了非處方助聽器功能。非處方助聽器可解決輕度聽力損失問題，這是聽力健康市場中滲透率最低的部分。

We believe these features will continue to drive hearing loss awareness as users will now have a hearing test readily available that could help them in understanding and recognizing hearing loss sooner. This coupled with the potential of eliminating the stigma of using hearing health device could drive earlier adoption of traditional hearing aids.

我們相信這些功能將繼續提高人們對聽力損失的認識，因為使用者現在可以隨時進行聽力測試，幫助他們更快地了解和識別聽力損失。再加上消除使用聽力健康設備的恥辱的潛力，可能會推動傳統助聽器的早期採用。

Similar to previous years, we are expecting the medtech especially audio segment to finish 2024 strong with Q4 revenue being the highest of the year, driven by normal seasonality from new product launches within the hearing health market.

與往年類似，我們預計醫療技術（尤其是音頻領域）將在 2024 年表現強勁，第四季度收入將達到全年最高水平，這是由聽力健康市場新產品發布的正常季節性推動的。

Looking at our precision device Segment, in spite of continued headwinds and inventory levels in the industrial markets and with our distribution partners, revenue grew 6% sequentially, driven by defense and electrification in markets. On a year over year basis, revenues grew 57% due to the acquisition of Cornell.

看看我們的精密設備部門，儘管工業市場以及我們的分銷合作夥伴面臨持續的阻力和庫存水平，但在市場國防和電氣化的推動下，收入仍環比增長了 6%。由於收購康乃爾大學，營收年增 57%。

I am also pleased with the progress we are making on expanding margins as we improve capacity utilization, productivity, and pricing. Reflecting on our ownership of Cornell this past year, I continue to be excited by this acquisition. We have improved our adjusted EBITDA margins 700 basis points throughout the year by accelerating cost synergies, continual operational improvements, and increased pricing.

隨著我們提高產能利用率、生產力和定價，我們在擴大利潤方面取得的進展也令我感到高興。回顧過去一年我們對康乃爾大學的所有權，我仍然對這項收購感到興奮。透過加速成本綜效、持續改善營運和提高定價，我們全年調整後 EBITDA 利潤率提高了 700 個基點。

We have also installed a disciplined approach to cash deployment leading to increased net operating cash flow. Despite continued challenges in our end markets, Cornell is expected to be creative in its first year of ownership, a significant milestone and a critical pillar in our acquisition strategy.

我們也採用了嚴格的現金部署方法，從而增加了淨營運現金流。儘管我們的終端市場面臨持續的挑戰，康乃爾大學預計將在擁有所有權的第一年發揮創造力，這是一個重要的里程碑，也是我們收購策略的關鍵支柱。

As I look forward for the full precision device Segment, we expect to see modest sequential revenue growth in Q4. While we have a very healthy pipeline of new opportunities in multiple end markets, which positions us well for growth as the market recovers in 2025. Bookings continue to be inconsistent as we have yet to see a sustained recovery in the industrial end market and with our distribution partners.

當我展望全精密設備細分市場時，我們預期第四季營收將出現適度的環比成長。雖然我們在多個終端市場擁有非常健康的新機會，這為我們在 2025 年市場復甦時實現成長奠定了良好的基礎。由於我們尚未看到工業終端市場以及我們的分銷合作夥伴的持續復甦，預訂量仍然不一致。

As I noticed in the beginning of our call, I am pleased with the signing of the definitive agreement to sell the consumer MEMS microphone business. As already discussed our quarterly results demonstrate our expanded margin profile as we continue to focus on more attractive growing and markets in the medtech, defense, electrification and industrial spaces.

正如我在通話開始時注意到的那樣，我很高興簽署出售消費 MEMS 麥克風業務的最終協議。正如已經討論的那樣，我們的季度業績表明，隨著我們繼續專注於醫療技術、國防、電氣化和工業領域更具吸引力的成長和市場，我們的利潤率有所擴大。

I am confident in our ability to deliver shareholder value as we complete this important step in our evolution to a leading industrial technology company. We expect the closing by the end of the fourth quarter and anticipate holding an investor forum in Q1 2025, when we will discuss our growth strategy and plans for the future in more detail.

我對我們為股東創造價值的能力充滿信心，因為我們完成了向領先工業技術公司發展的這一重要步驟。我們預計在第四季末完成交割，並預計在 2025 年第一季舉行投資者論壇，屆時我們將更詳細地討論我們的成長策略和未來計畫。

Now let me turn the call over to John to detail our quarter results and provide Q4 guidance.

現在讓我將電話轉給約翰，詳細說明我們的季度業績並提供第四季度的指導。

Thanks, Jeff. Please keep in mind, all measures that I'll be referencing today are on a continuing operations basis and exclude the consumer MEMS microphone business, unless specifically stated. We reported third quarter revenues of $143 million at the high end of the guidance range, and up 32% from the year ago period, driven by the acquisition of Cornell in the fourth quarter of 2023 and organic growth of 4%.

謝謝，傑夫。請記住，除非特別說明，我今天引用的所有指標均以持續營運為基礎，不包括消費性 MEMS 麥克風業務。我們報告的第三季營收為 1.43 億美元，處於指導範圍的高端，比去年同期成長 32%，這得益於 2023 年第四季收購康乃爾大學和 4% 的有機成長。

EPS was $0.26 in the quarter at the midpoint of our guidance range and up $0.06 or 30% from the third quarter of 2023. In the medtech and specialty audio segment, revenue was $64 million, up 10% versus the prior year on higher demand in both hearing health and specialty audio. Gross margins were 53.1%, down 60 basis points versus the year ago period, driven by unfavorable product mix and slightly lower production yields.

本季每股收益為 0.26 美元，位於我們指引範圍的中點，較 2023 年第三季上漲 0.06 美元，即 30%。在醫療技術和專業音訊領域，由於聽力健康和專業音訊需求的增加，收入為 6,400 萬美元，比上年增長 10%。由於產品結構不利和產量略有下降，毛利率為 53.1%，較去年同期下降 60 個基點。

The precision devices segment delivered revenues of $79 million, up 57% from the year ago period, driven by the acquisition of Cornell, partially offset by lower shipments of high-performance capacitors into the distribution channel and to OEMs in the industrial end market as customer and channel inventories remain elevated.

在收購康乃爾大學的推動下，精密設備部門營收 7,900 萬美元，年增 57%，部分被分銷通路和作為客戶的工業終端市場 OEM 的高性能電容器出貨量減少所抵銷通路庫存依然較高。

Shipments into the medical, defense and electrification markets were up slightly and in line with expectations. Gross margins were 40%, down 40 basis points from the third quarter of 2023 due to the acquisition of Cornell, partially offset by a 230 basis point improvement in legacy PD margins driven by factory productivity gains.

醫療、國防和電氣化市場的出貨量略有成長，符合預期。由於收購康乃爾大學，毛利率為 40%，較 2023 年第三季下降 40 個基點，部分被工廠生產力提高推動的傳統 PD 利潤率提高 230 個基點所抵銷。

While gross margins at Cornell are below our legacy precision device business, we saw 500 basis point gross margin improvement since Q1 of this year, driven by improved factory capacity utilization, supply chain savings, and higher pricing. On a total company basis, R&D expense in the quarter was $8.9 million, Up $1 million from Q3 2023 due to the acquisition of Cornell.

雖然康乃爾大學的毛利率低於我們傳統的精密設備業務，但自今年第一季以來，由於工廠產能利用率提高、供應鏈節省和定價上漲，我們的毛利率提高了 500 個基點。就公司整體而言，本季的研發費用為 890 萬美元，由於收購康乃爾大學，比 2023 年第三季增加 100 萬美元。

SG&A Expenses were $24 million, $5 million higher than prior year levels driven by the acquisition of Cornell, partially offset by restructuring actions taken in the second half of 2023 in the PD segment. Interest expense was up $3.3 million versus the prior year due to higher bank borrowings associated with the acquisition of Cornell in the fourth quarter of 2023.

由於收購康乃爾大學，SG&A 費用為 2,400 萬美元，比上年水準高出 500 萬美元，部分被 2023 年下半年 PD 部門採取的重組行動所抵銷。由於 2023 年第四季收購與康乃爾大學相關的銀行借款增加，利息支出較前一年增加 330 萬美元。

Now I'll turn to our balance sheet and cash flow. In the third quarter we generated $53 million in cash from operating activities above the high end of our guidance range on lower than expected networking capital and higher cash received from settlement of foreign exchange forward contracts.

現在我將談談我們的資產負債表和現金流。第三季度，我們的經營活動產生了 5,300 萬美元的現金，高於我們指導範圍的上限，因為網路資本低於預期，而外匯遠期合約結算收到的現金較高。

For the first nine months of 2024, we generated $95 million in operating cash flow, representing a $30 million increase over the first nine months of 2023. Please note that cash from operations for the three and nine months ended September 30 is inclusive of the consumer MEMS microphone business. Capital spending was $4 million in the quarter.

2024 年前 9 個月，我們產生了 9,500 萬美元的營運現金流，比 2023 年前 9 個月增加了 3,000 萬美元。請注意，截至 9 月 30 日的三個月和九個月的營運現金包括消費者 MEMS 麥克風業務。本季資本支出為 400 萬美元。

During the third quarter, we repurchased 250,000 shares at a total cost of $4.5 million and reduced outstanding bank borrowings under our revolving credit facility by $38 million. We exited the quarter with cash of $93 million and $225 million of debt. That includes borrowings under our revolving credit facility and an interest free seller note issued in connection with the Cornell acquisition. Lastly, our net leverage ratio based on trailing 12 months adjusted EBITDA was 1 times.

第三季度，我們以總成本 450 萬美元回購了 25 萬股股票，並將循環信貸安排下的未償還銀行借款減少了 3,800 萬美元。本季結束時，我們擁有 9,300 萬美元的現金和 2.25 億美元的債務。這包括我們的循環信貸額度下的借款以及與康乃爾大學收購相關的無息賣方票據。最後，我們基於過去 12 個月調整後 EBITDA 的淨槓桿率為 1 倍。

Moving to our guidance. For the fourth quarter of 2024, revenues are expected to be between $141 million and $151 million, up 5% versus the year ago period driven by the acquisition of Cornell. R&D expenses are expected to be between $8 million and $9 million, and selling and administrative expenses are expected to be within a range of $23 million to $25 million flat with the prior year.

轉向我們的指導。在收購康乃爾大學的推動下，2024 年第四季的營收預計將在 1.41 億美元至 1.51 億美元之間，較去年同期成長 5%。研發費用預計在 800 萬美元至 900 萬美元之間，銷售和管理費用預計在 2,300 萬美元至 2,500 萬美元之間，與去年持平。

We're projecting adjusted EBIT margin for the quarter to be within a range of 21% to 23%. Interest expense in Q4 is estimated to be $3 million and includes non-cash imputed interest. We expect an effective tax rate of 9% to 13% for the quarter, which is lower than normal due to the utilization of foreign tax credits.

我們預計本季調整後的息稅前利潤率將在 21% 至 23% 的範圍內。第四季的利息支出預計為 300 萬美元，其中包括非現金估算利息。我們預計本季的有效稅率為 9% 至 13%，由於利用了外國稅收抵免，該稅率低於正常水平。

We're projecting EPS to be within a range of $0.26 to $0.30 per share. This assumes weighted average shares outstanding during the quarter of $91.2 million on a fully diluted basis.

我們預計每股收益將在 0.26 美元至 0.30 美元之間。假設本季完全稀釋後的加權平均流通股為 9,120 萬美元。

We're projecting cash from operating activities to be within a range of $30 million to $40 million, and capital spending is expected to be $6 million. Cash from operating activities includes $5 million to $10 million used by discontinued operations, and capital spending includes $2 million related to discontinued operations.

我們預計經營活動產生的現金將在 3,000 萬至 4,000 萬美元之間，資本支出預計為 600 萬美元。經營活動產生的現金包括已終止經營業務使用的 500 萬至 1,000 萬美元，資本支出包括與已終止經營業務相關的 200 萬美元。

In summary, our third quarter results and fourth quarter guidance highlight the margin profile of our continuing operations. In addition, our increased exposure to attractive end markets which include medtech, defense, electrification and industrials is expected to drive higher organic revenue growth rates which we will cover in more detail at our investor forum which is planned for Q1 of 2025.

總之，我們第三季的業績和第四季的指導凸顯了我們持續經營業務的利潤率狀況。此外，我們增加對醫療技術、國防、電氣化和工業等有吸引力的終端市場的投資，預計將推動更高的有機收入成長率，我們將在計劃於2025 年第一季舉行的投資者論壇上更詳細地介紹這一點。

I'll now turn the call back over to the operator for the Q&A portion of our call. operator.

現在，我將把電話轉回給接線員，以進行電話的問答部分。操作員。

(Operator Instructions) Bob Labick, CJS.

（操作員說明）Bob Labick，CJS。

Good afternoon. Thanks for taking our questions and congratulations on the further transformation of the company.

午安.感謝您提出我們的問題，並對公司的進一步轉型表示祝賀。

So I wanted to start with the kind of the underlying demand in PD. And I know, I think, John, in your remarks, you talked a little bit about the end markets, but I wasn't typing fast enough. So maybe you could kind of remind us what you said and then tell us the driver. So what end markets in PD are the strongest right now? And what's driving that? And where is the weakness that you're seeing? And when do you see that kind of recovering?

所以我想從PD的潛在需求開始。我知道，約翰，在您的演講中，您談到了一些終端市場，但我打字的速度不夠快。所以也許您可以提醒我們您所說的話，然後告訴我們司機。那麼，目前 PD 的哪些終端市場最強呢？是什麼推動了這一點？您看到的弱點在哪裡？你什麼時候看到這種復甦？

Let me just first give some color. This is Jeff. So I would sit there and say generally speaking, the defense market still looks pretty okay. I think obviously, as long as with defense, there has been and can be a time to time lumpiness relative to timing of orders, but the underlying demand is still there. And I think that's been best strength.

讓我先給一些顏色。這是傑夫。所以我會坐在那裡說，總的來說，國防市場看起來仍然相當不錯。我認為顯然，只要有國防，相對於訂單時間的安排就會時不時地出現並且可能會出現波動，但潛在的需求仍然存在。我認為這是最好的力量。

I think we've definitely seen, especially when you think about our Medtech business in PD, but if you take it overall with the MSA business, our medtech business continues to remain strong, I would say specifically in the PD area. We're starting to see the turn back to growth in medtech in the PD section. I think MSA has still been doing very well, but medtech is still growing.

我認為我們肯定已經看到了，特別是當你考慮我們在 PD 領域的醫療技術業務時，但如果你把它與 MSA 業務結合起來，我們的醫療技術業務將繼續保持強勁，特別是在 PD 領域。我們開始看到 PD 領域的醫療技術成長回升。我認為 MSA 仍然表現得很好，但醫療技術仍在成長。

I think, what I would sit there and say, from my perspective, electrification in Q3 and Q4 overall is probably flattish year over year. But the real weakness still remains in the industrial and I would call with our distribution partners, which is a lot of industrial business, and so that's kind of like the real weakness that we see it yet.

我認為，從我的角度來看，第三季和第四季的電氣化整體情況可能與去年同期持平。但真正的弱點仍然存在於工業領域，我會打電話給我們的分銷合作夥伴，其中有很多工業業務，所以這有點像我們所看到的真正的弱點。

I'd say, I was with a number of our distributors who actually visiting those yesterday, and then their commentary is kind of what we're seeing, which is one month bookings are good. Next month, they're a little weaker, then they come back. We're just not seeing yet in that portion of the market, the consistency of bookings that we need to really see, consistent year-over-your growth.

我想說的是，我和一些經銷商一起參觀了昨天的活動，然後他們的評論就是我們所看到的，即一個月的預訂量很好。下個月，他們會稍微虛弱一點，然後就會回來。我們只是還沒有在這部分市場中看到我們真正需要看到的預訂一致性，即同比增長的一致性。

Now, what I would say is, I think we're still hopeful as we get into late Q1 and Q2, we should start seeing some recovery at least that's what some of our distribution partners are talking about. But I think the great thing is in spite of all these things, the PD Gross margin expanded through the year, and we expect there's opportunity for further expansion first with the synergies and the things we're doing on the Cornell side, but also on capacity utilization relative to the traditional PD business that is not at Cornell.

現在，我想說的是，我認為隨著進入第一季末和第二季度，我們仍然充滿希望，我們應該開始看到一些復甦，至少這是我們的一些分銷合作夥伴正在談論的。但我認為最棒的是，儘管發生了所有這些事情，PD 毛利率在這一年中仍在擴大，我們預計，首先通過協同效應和我們在康奈爾大學方面所做的事情，有進一步擴大的機會，但也相對於康乃爾大學以外的傳統 PD 業務的產能利用率。

Okay, great. I appreciate that very much, and obviously with the transformation, you're going to probably be a little more asset light and you may have told us this previously, but could you remind us the kind of go forward level of CapEx for kind of remainco or --?

好的，太好了。我非常欣賞這一點，顯然，隨著轉型，您可能會更加輕資產，您可能已經告訴過我們這一點，但您能否提醒我們，剩餘成本的資本支出水平是怎樣的？——？

Yeah, sure, Bob. I would say over a cycle kind of 3% of revenue range, 3%. If we had some expansion in an area, you could have a period where it's a little above that. But I think overall, over a cycle 3% revenue.

是的，當然，鮑伯。我想說的是，在一個週期內，收入範圍為 3%，3%。如果我們在某個領域進行一些擴張，那麼一段時期內可能會略高於這個水準。但我認為整體而言，一個週期內收入成長3%。

Over a cycle and there could be a year were slightly lower, and then years where we're slightly over, but probably 2% to 4.5% depending on where we are in the cycle.

在一個週期中，可能有一年略低，然後有幾年略高，但可能是 2% 到 4.5%，這取決於我們在週期中的位置。

2024 will probably likely be a little under the 3%.

2024 年這一比例可能會略低於 3%。

Okay. Got it. Great. And then the last one I'll jump back in queue here. But obviously, this is kind of just the beginning, so to speak. Can you talk about the M&A environment for you right now and the characteristics of targets and how long it'll take you to kind of get back out and looking at things or what's out there now?

好的。知道了。偉大的。然後最後一個我會在這裡插回隊列。但顯然，可以說這只是一個開始。您能談談您現在的併購環境以及目標的特點以及您需要多長時間才能重新審視事物或現在的情況嗎？

Yeah, I think it's a great question. Thanks for that, I think it's, a core portion of our strategy going forward in terms of finding opportunities like Cornell where there's good synergies with what we do.

是的，我認為這是一個很好的問題。感謝這一點，我認為這是我們未來策略的核心部分，即尋找像康奈爾大學這樣的機會，在那裡與我們所做的事情有良好的協同效應。

I would say that we have a number of opportunities in front of us that we're assessing right now. I mean, it's always hard to say when that's going to come to fruition, we are going to be very selective in like what we do. We don't want to do something that we come out in the street; we think it doesn't make sense. So we're being very careful, we do.

我想說的是，我們現在正在評估許多機會。我的意思是，總是很難說何時會實現，我們將非常有選擇性地對待我們所做的事情。我們不想做一些我們在街上出現的事情；我們認為這沒有意義。所以我們非常小心，我們確實如此。

I would just add one thing that we are very pleased about that I think helps really the M&A story, which is, it's very clear for us with all the transformation we've done into a higher margin business, your multiple is expanding and I think that gives us more options relative to acquisitions.

我只想補充一件我們非常高興的事情，我認為這對併購故事確實有幫助，那就是，對於我們來說，透過我們向更高利潤率業務所做的所有轉型，您的倍數正在擴大，我認為這一點非常清楚這為我們提供了更多與收購相關的選擇。

Our EBITDA multiple is expanding, and so it gives us more options with M&A and so could make things accretive, much faster on a higher multiple of EBITDA basis. So I think this is very critical to our future, and we have a lot of resource being put into this. So well, I can't definitively say once something happens, we are on the hunt right now. I mean, we are looking.

我們的 EBITDA 倍數正在擴大，因此它為我們提供了更多併購選擇，因此可以在更高的 EBITDA 倍數基礎上更快地實現增值。所以我認為這對我們的未來非常關鍵，我們為此投入了大量資源。所以，我不能明確地說，一旦發生什麼事，我們現在就在追捕。我的意思是，我們正在尋找。

Got it. Okay, super. Thanks so much.

知道了。好吧，超級。非常感謝。

Christopher Roland, Susquehanna.

克里斯多福羅蘭，薩斯奎哈納。

Hey guys, thanks for the question. I guess my first one is Cornell, that's pretty amazing margin expansion that you have there. I was wondering, do you still have continued opportunities? I'd also love to focus a little bit on pricing there. Do you think you still have movement upwards in pricing? Is there something left here in terms of margin improvement that we could see for the CD Business?

嘿夥計們，謝謝你的提問。我想我的第一個是康乃爾大學，那裡的利潤率擴張非常驚人。我想知道，你還有繼續的機會嗎？我還想稍微關心一下那裡的定價。您認為定價仍有上漲空間嗎？CD 業務的利潤率是否還有改善？

Let me handle the pricing first and then I'll let John talk just generally to the margins overall. So if you remember when we went through this, I think, don't hold me exact numbers when we first announced the deal, we didn't really talk too much about price by the end of the first quarter of owner, we kind of talked about a couple of million dollars of price.

讓我先處理定價，然後讓約翰大致談談整體利潤率。因此，如果您還記得我們經歷過這件事，我想，當我們第一次宣布這筆交易時，請不要告訴我確切的數字，到業主第一季末時，我們並沒有真正談論太多價格，我們有點談到了幾百萬美元的價格。

I think last quarter, I talked about $3 million to $4 million of price. I think we're going to be for the year above $5 million of price that we're going to get this year. And if you look at the timing of price, we have longer term contracts with customers. We have there's a lot of inventory in the channel, relatively industrial. So there's going to be based on the pricing actions we've already taken, there's going to be more price in 2025.

我想上個季度，我談到了 300 萬至 400 萬美元的價格。我認為我們今年的價格將超過 500 萬美元。如果你看一下價格的時間，我們與客戶簽訂了長期合約。我們通路裡有很多庫存，相對工業化的。因此，根據我們已經採取的定價行動，2025 年將會有更高的價格。

So I would say $5 million this year, maybe another couple of million next. So a big portion of the margin improvement is coming from price. I'd say the second thing and John can kind of expand on this.

所以我想說今年是 500 萬美元，明年可能還會是幾百萬美元。因此，利潤率的提高很大一部分來自於價格。我想說的是第二件事，約翰可以對此進行擴展。

But we really haven't done a tremendous amount yet on like what I call value creation in on the manufacturing floors with Cornell, that process will take start of next year. We'll start working on that. We'll start laying that out. But I think there's also opportunity to do the things that we do in the traditional no business, whether it be PD or the MSA business where we get a fair amount of value creation every single year.

但我們確實還沒有做很多事情，就像我所說的與康奈爾大學一起在製造車間創造價值，這個過程將從明年開始。我們將開始研究這一點。我們將開始闡述這一點。但我認為，我們也有機會做我們在傳統非業務中所做的事情，無論是 PD 還是 MSA 業務，我們每年都會創造相當多的價值。

So I would say I'm reasonably confident that we're going to have more margin expansion. And we'll talk more about the Investor Day kind of your overall for the PD segment. What kind of margin expansion that we we can get? But we should get more from Cornell. I don't know, John, you may add any color.

所以我想說，我有理由相信我們將實現更多的利潤率擴張。我們將更多地討論投資者日的 PD 部分。我們可以獲得什麼樣的利潤擴張？但我們應該從康乃爾大學得到更多。我不知道，約翰，你可以添加任何顏色。

Look, just I think, just to kind of reiterate what Jeff said, and we had 500 basis points of improvement in Cornell and it was really driven by improved pricing. Also, to a lesser extent, we're getting some supply chain savings, material savings. So that's there. I think that will continue into '25.

聽著，我想，只是重申傑夫所說的話，我們在康乃爾大學取得了 500 個基點的進步，這實際上是由定價改善推動的。此外，在較小程度上，我們也節省了一些供應鏈和材料。就這樣。我認為這種情況會持續到25年。

And then also we're planning on getting the major sites on our Oracle instance. Once we get that, there's some also, I'll call it OpEx synergies to harvest from that. So there's room for increased margin in that coordination.

然後我們也計劃在我們的 Oracle 實例上取得主要網站。一旦我們實現了這一點，我將稱之為營運支出協同效應，從中收穫。因此，這種協調還有增加空間的空間。

Yes, I think what I just would kind of highlight here is the last thing on the price because obviously this has been a relatively challenging year for the PD segment as a whole in terms of revenue, especially the industrial market. And we're still getting $5 million of price in the year. And I think that's a bodes really well for as the market recovers, what it means.

是的，我想我在這裡要強調的是價格上的最後一件事，因為顯然，就收入而言，今年對於整個PD 細分市場來說是相對具有挑戰性的一年，尤其是工業市場。今年我們仍然可以獲得 500 萬美元的價格。我認為隨著市場的復甦，這確實是一個好兆頭，這意味著什麼。

Thank you, Jeff. And yeah, I did as a lead in, want to talk a little bit more about industrial. So it sounds like there might be some inventory there. Would love to know when you think that normalizes how much inventory is there?

謝謝你，傑夫。是的，我確實作為主角，想多談談工業。所以聽起來那裡可能有一些庫存。想知道您認為庫存量何時會正常化嗎？

And then if you could break this up into what you're seeing geographically, like east versus west I know there's a debate over EV's, for example, China EV's look good. West EV's look a little soft and anything like that would be helpful.

然後，如果您可以將其分解為您在地理上看到的情況，例如東方與西方，我知道存在關於電動車的爭論，例如，中國電動車看起來不錯。West EV 看起來有點軟，類似的東西會有幫助。

Yeah. So I think our best indicator quite frankly of inventory. It's really hard with, a little harder with OEMs or direct customers to really know the exact amount of inventory. But with our distribution partners, we have a pretty good view into the inventory that they have. We still believe based on the data they're reporting to us that our distribution has about six months worth of inventory on hand right now.

是的。因此，我認為我們最好的指標是庫存。對於原始設備製造商或直接客戶來說，要真正了解確切的庫存量確實很困難，甚至有點困難。但透過我們的分銷合作夥伴，我們可以很好地了解他們的庫存。根據他們向我們報告的數據，我們仍然相信我們的經銷商目前手頭上有大約六個月的庫存。

In order to really get back to normal ordering patterns, that's still got come down by about three months now. When that happens again, as I kind of said on the earlier question, when we meet our distributor partners, they say one month's good one month poor. It's been inconsistent, right? Hasn't been all just totally horrible, but it's been inconsistent.

為了真正恢復正常的訂購模式，現在仍然需要大約三個月的時間。當這種情況再次發生時，正如我在之前的問題上所說的那樣，當我們見到我們的經銷商合作夥伴時，他們說一個月好，一個月差。一直不一致，對吧？並不完全是可怕的，但它是不一致的。

And I would say is this primarily in North America and in Europe there isn't as much business in our PD segment in the industrial markets in Asia. It's not as much, it's specific to electrification. Now, that's really not China, but we do have Asian customers. We are not doing a tremendous amount of electrification in China.

我想說的是，這主要是在北美和歐洲，我們的 PD 部門在亞洲工業市場的業務並不多。它不是那麼多，而是特定於電氣化的。現在，那確實不是中國，但我們確實有亞洲客戶。我們在中國並沒有進行大量的電氣化建設。

I would say we're doing and that again right now in the back half of the year looking at this, it's flattish year over year. In terms of -- what I say is yes, the electrification market is weak as you kind of pointed out. But we also have new design wins going into production. We are gathering new opportunities that are starting production. So that's kind of offsetting being down in electrification even though we're not participating as heavily in China.

我想說的是，我們正在這樣做，現在在今年下半年再看一遍，情況與去年同期持平。就我而言，是的，正如您所指出的那樣，電氣化市場疲軟。但我們也有新的設計成果投入生產。我們正在收集正在開始生產的新機會。因此，儘管我們在中國的參與程度不高，但這在一定程度上抵消了電氣化水平的下降。

Awesome. Thank you.

驚人的。謝謝。

(Operator Instructions) Tristan Garrett, Baird.

（操作員說明）Tristan Garrett，Baird。

Hi, good afternoon. Looking at the macro environment and you highlighted the continued weakness in industrial. The first question is, have you seen in other end markets including consumer, any changes in demand patterns over the past few months or is it stable?

嗨，下午好。縱觀宏觀環境，您強調了工業的持續疲軟。第一個問題是，您是否看到包括消費者在內的其他終端市場過去幾個月的需求模式有任何變化或穩定？

And also, if you could talk about pricing, excluding the impressive progress you're making at Cornell, are you seeing any unusual pricing changes in the high end capacitors? What are you hearing from your customers as you perhaps renegotiate some annual pricing contracts there?

另外，如果你能談談定價，排除你在康乃爾大學取得的令人印象深刻的進步，你是否看到高端電容器有任何不尋常的定價變化？當您可能在那裡重新談判一些年度定價合約時，您從客戶那裡聽到了什麼？

Yeah. So first I'll just make a comment, obviously, we've moved the CMM business into discontinued ops and that's our exposure to consumer until obviously, that is fully sold. That is in line with our expectation going into the quarter, and if I look even in the Q4, it's running in line with expectation. I think it's doing fine.

是的。因此，首先我要發表評論，顯然，我們已將 CMM 業務轉移到已停產的營運中，這就是我們對消費者的敞口，直到完全出售為止。這符合我們對本季的預期，如果我看看第四季度，它的運作也符合預期。我認為做得很好。

So I think there aren't any big issues we see in consumer at this moment, I guess about the pricing environment first within MSA, I would say stable. That's what I would say, we're not seeing a tremendous amount of pricing increases, but we're not seeing pricing reductions either that are pointing to any issues.

所以我認為目前我們在消費者中沒有看到任何大問題，我想首先是 MSA 內部的定價環境，我會說穩定。這就是我想說的，我們沒有看到價格大幅上漲，但也沒有看到價格下降，這表明存在任何問題。

And then in PD, which is primarily ceramic capacitors, and which is a lot of end markets. And then RF, which is primarily defense, I would actually say in defense there is, we still think some opportunity in terms of price in the RF market going forward.

然後是PD，主要是陶瓷電容器，有很多終端市場。然後是射頻，主要是防禦，我實際上想說的是，在防禦方面，我們仍然認為射頻市場未來在價格方面存在一些機會。

And then in the traditional cap space, I would say it's stable. I think one of the benefits we have in our businesses is that, a big portion of our businesses in PD is sole source positions, and so I think we've heard long term contracts with a lot of people and we don't see a tremendous amount of price pressure in these markets even in a down market.

然後在傳統的薪資空間中，我會說它是穩定的。我認為我們在業務中擁有的好處之一是，我們在 PD 業務中的很大一部分是獨家來源職位，因此我認為我們已經聽說過與很多人簽訂的長期合同，並且我們沒有看到即使在在市場低迷的情況下，這些市場也面臨巨大的價格壓力。

Great. That's great to hear. And then, how should we be looking at this coming quarter as the sequential trends for the various end market within the PD?

偉大的。很高興聽到這個消息。那麼，我們該如何看待未來一個季度 PD 內各個終端市場的連續趨勢？

Yeah. Okay. Let me look at these on a sequential basis we're expecting, but first let me say for PD overall, I said on the prepared remarks, we're expecting modest sequential growth, right? And so if I look at the end markets, overall defense is going to be up, medtech is going to be up, electrification is flat, and industrial is flat, right.

是的。好的。讓我按我們預期的順序來看看這些，但首先讓我說一下整體的 PD，我在準備好的評論中說過，我們預計會出現適度的連續增長，對吧？因此，如果我看看終端市場，整體國防將會上升，醫療技術將會上升，電氣化將持平，工業將持平，對吧。

So again, back to my point about industrial and distribution, which is a lot of in industrial customers. It's not like we're seeing a degradation sequentially, but obviously these numbers were running a lot higher if you go back a year and a half ago. So we're just not seeing the continued improvement that we saw, we did see some improvement from Q2 to Q3 in the industrial market. But that's kind of like now back to flat sequentially from Q3 to Q4.

再次回到我關於工業和分銷的觀點，工業客戶中有很多。我們並沒有看到連續的退化，但如果你回到一年半前，顯然這些數字要高得多。因此，我們只是沒有看到我們所看到的持續改善，我們確實看到工業市場從第二季到第三季有所改善。但這有點像現在從第三季到第四季依序回到持平。

Great. Thank you very much.

偉大的。非常感謝。

There are no further questions at this time. This will concludes today's conference call. Thank you all for your participation. You may now disconnect.

目前沒有其他問題。今天的電話會議到此結束。感謝大家的參與。您現在可以斷開連線。