MSC Industrial Direct Co Inc (MSM) 2024 Q3 法說會逐字稿

Good morning, and welcome to the MSC third quarter fiscal 2024 earnings call. (Operator Instructions) Please note this event is being recorded.

早安，歡迎參加 MSC 2024 財年第三季財報電話會議。 （操作員說明）請注意此事件正在被記錄。

I would now like to turn the conference over to Ryan Mills, Head of Investor Relations. Please go ahead.

我現在想將會議交給投資者關係主管 Ryan Mills。請繼續。

Thank you, and good morning, everyone. Welcome to our third quarter fiscal 2024 earnings call. Erik Gershwind, our Chief Executive Officer; and Kristen Actis-Grande, our Chief Financial Officer, are both on the call with me today.

謝謝大家，大家早安。歡迎參加我們的 2024 財年第三季財報電話會議。艾瑞克‧格甚溫德 (Erik Gershwind)，我們的執行長；我們的財務長 Kristen Actis-Grande 今天都與我通話。

During today's call, we will refer to various financial data in the earnings presentation and operational statistics document that accompany our comments, both of which can be found on our Investor Relations website.

在今天的電話會議中，我們將參考我們評論中的收益演示和營運統計文件中的各種財務數據，這些數據都可以在我們的投資者關係網站上找到。

Let me reference our Safe Harbor statement found on slide two of the earnings presentation. Our comments on this call, as well as the supplemental information we are providing on the website, contain forward-looking statements within the meaning of US security laws. These forward-looking statements involve risks and uncertainties that could cause actual risk, and we would like to refer to those results to differ materially from those anticipated by these statements. Information about these risks is noted in our earnings press release and our other SEC filings.

讓我參考一下收益簡報第二張投影片上的安全港聲明。我們對本次電話會議的評論以及我們在網站上提供的補充資訊包含美國安全法含義內的前瞻性聲明。這些前瞻性陳述涉及可能導致實際風險的風險和不確定性，我們希望這些結果與這些陳述預期的結果有重大差異。有關這些風險的資訊已在我們的收益新聞稿和其他 SEC 文件中註明。

In addition, during this call, we may refer to certain adjusted financial results, which are non-GAAP measures. Please refer to the GAAP versus non-GAAP reconciliations in our presentation or on our website, which contains the reconciliations of the adjusted financial measures to the most directly comparable GAAP measures.

此外，在本次電話會議中，我們可能會參考某些調整後的財務業績，這些都是非公認會計原則衡量標準。請參閱我們的簡報或我們網站上的 GAAP 與非 GAAP 調整表，其中包含調整後的財務指標與最直接可比較的 GAAP 指標的調整表。

I'll now turn it over to Erik.

我現在把它交給艾瑞克。

Thank you, Ryan. Good morning, everyone, and thank you for joining us today. During today's call, I'll provide an update on progress of the corrective actions that we outlined on our preliminary third-quarter call. I'll then pivot to current trends in the macro environment, before passing it over to Kristen, who will cover our fiscal third quarter results and our full-year outlook in greater detail.

謝謝你，瑞安。大家早安，感謝您今天加入我們。在今天的電話會議中，我將提供我們在第三季初步電話會議中概述的糾正措施的最新進展。然後，我將重點關注宏觀環境中的當前趨勢，然後將其交給克里斯汀，她將更詳細地介紹我們的第三財季業績和全年展望。

Over the past couple of weeks, our team has been heads down and focused on getting MSC back to the high standards demanded by our mission statement and regaining the momentum from our first mission critical chapter. Though there is still much work to be done, I am encouraged by how our team is rallying. We remain committed to the strategy that we outlined at the start of the fiscal year, which is our second mission critical chapter.

在過去的幾周里，我們的團隊一直埋頭苦幹，專注於讓 MSC 回到我們的使命宣言所要求的高標準，並從我們第一個關鍵任務章節中恢復動力。儘管還有很多工作要做，但我對我們團隊的團結感到鼓舞。我們仍然致力於我們在本財年開始時概述的策略，這是我們的第二個關鍵任務章節。

And as a reminder, this strategy has three components. First, to maintain momentum on our high touch and technical solutions. Second, to re-energize our core customer growth. And third, to drive productivity and reduce costs to serve, enabling expansion to the mid-teens adjusted operating margins over time.

提醒一下，該策略由三個組成部分組成。首先，保持我們高接觸度和技術解決方案的動力。其次，為核心客戶成長注入新的活力。第三，提高生產力並降低服務成本，隨著時間的推移，調整後的營運利潤率能夠擴大到十幾歲左右。

During our preliminary results release, we described that our biggest disappointment impacting this fiscal year's results has been re-energizing our core customer, due in large part to delays in our website improvements. We also experienced some unexpected gross margin pressure in our fiscal third quarter following the full rollout of web price realignment.

在我們的初步業績發布中，我們描述了影響本財年業績的最大失望是重新激活我們的核心客戶，這在很大程度上是由於我們網站改進的延遲。在全面推出網路價格調整後，我們在第三財季也經歷了一些意想不到的毛利率壓力。

Let me jump right into the steps taken and the progress made since our preliminary results call, starting with web price realignment. The corrective actions that we took during May are working. This has resulted in gross margin improvement through the fiscal month of June, compared to the 3Q lows we experienced in April and early May. With these issues resolved, our web price realignment initiative is performing as planned.

讓我直接介紹一下自初步結果電話會議以來所採取的步驟和取得的進展，首先是網路價格調整。我們五月採取的糾正措施正在發揮作用。與 4 月和 5 月初經歷的第三季低點相比，整個 6 財月的毛利率有所改善。這些問題得到解決後，我們的網路價格調整計畫正在按計劃進行。

However, we remain in a heightened state of awareness and will continue monitoring performance closely. With respect to mscdirect.com, we are also making progress. The recent executive changes have given me a chance to get even closer to our team and to our development efforts. I'm passionate about this part of the business, as building one of the initial iterations of mscdirect.com was one of the more exciting times in my career.

然而，我們仍然保持高度警惕，並將繼續密切監控績效。關於 mscdirect.com，我們也在取得進展。最近的高階主管變動讓我有機會更接近我們的團隊和我們的開發工作。我對這部分業務充滿熱情，因為建立 mscdirect.com 的初始迭代之一是我職業生涯中最令人興奮的時刻之一。

We have a capable, experienced, and tenured team working on this initiative, many of whom I've worked with for well over a decade. I'm confident that we're taking the right steps, and we'll bring MSC's e-commerce efforts to new heights.

我們擁有一支有能力、經驗豐富且長期任職的團隊致力於這項計劃，其中許多人與我共事了十多年。我相信我們正在採取正確的步驟，我們將把 MSC 的電子商務工作推向新的高度。

We have taken a few recent steps to improve execution under the newly formed team. First, as I mentioned a couple of weeks ago, we've added third-party expertise. This was done to validate our architecture and provide the arms and legs to move production along more swiftly. We've also implemented twice per week executive reviews, and those include me. These reviews are bringing more transparency, collaboration, and energy to the program.

我們最近採取了一些措施來提高新組建團隊的執行力。首先，正如我幾週前提到的，我們增加了第三方專業知識。這樣做是為了驗證我們的架構，並為更快地推動生產提供支援。我們還每週進行兩次高階主管審查，其中包括我。這些審查為該計劃帶來了更多透明度、協作和活力。

We expect to deliver enhancements to search and product discovery beginning this month. These include improvements to search accuracy and relevance, and the introduction of a new presentation of results, which will begin with a narrow slice of our product offering and roll out on a broader scale in the upcoming quarters.

我們預計從本月開始將增強搜尋和產品發現功能。其中包括改進搜尋準確性和相關性，以及引入新的結果呈現方式，這將從我們產品的一小部分開始，並在接下來的幾季中更廣泛地推出。

We are targeting to have the site ready to support the launch of our marketing campaign during the second quarter of fiscal 2025. At that point, we would expect to realize the benefits of the three initiatives aimed at re-energizing our core customer, which works synergistically together, and those are the new web pricing, the new web platform, and our marketing program to attract new customers and achieve higher retention and growth of existing customers.

我們的目標是讓網站做好準備，以支持在2025 財年第二季啟動我們的行銷活動。舉措將發揮作用這些是新的網路定價、新的網路平台和我們的行銷計劃，以吸引新客戶並實現現有客戶的更高保留和成長。

Given the hiccups we've experienced with the web enhancements and the web price realignment, we're taking a fresh look across our other technology initiatives, including the upgrade and timing of our digital core and back-office value streams. We'll provide an update of our finding next quarter following the completion of this review.

鑑於我們在網路增強和網路價格調整方面遇到的問題，我們正在重新審視我們的其他技術計劃，包括我們的數位核心和後台價值流的升級和時間安排。審核完成後，我們將在下個季度提供最新的調查結果。

On the operations side, we are on track with our key initiatives, including the timing of our Columbus CFC closure. Additionally, we're pleased with the progress of our network study, and we'll provide more information next quarter.

在營運方面，我們的關鍵措施正按計畫實施，包括哥倫布 CFC 關閉的時間。此外，我們對網路研究的進展感到滿意，我們將在下個季度提供更多資訊。

Turning to slide 6, we had two exciting additions to the portfolio in Premier Tooling and ApTex. Supported by our strong balance sheet, these two acquisitions build upon our history of bolt-on M&A in the metalworking space. Premier Tooling Group designs, manufactures, and reconditions cutting tools through a state-of-the-art facility and a talented team located in Goodyear, Arizona.

轉向幻燈片 6，我們在 Premier Tooling 和 ApTex 的產品組合中添加了兩個令人興奮的內容。在我們強大的資產負債表的支持下，這兩項收購建立在我們在金屬加工領域補強併購的歷史之上。 Premier Tooling Group 透過位於亞利桑那州固特異的最先進的設施和才華橫溢的團隊來設計、製造和修復切割工具。

This acquisition strengthens our regrind and special tooling service offering that was recently enhanced through the acquisition of Tru-Edge by expanding our reach to western parts of the US.

此次收購加強了我們的重磨和特殊模具服務產品，最近透過收購 Tru-Edge 將我們的業務範圍擴大到美國西部地區，從而增強了我們的重磨和特殊模具服務產品。

The second addition is ApTex, a production-oriented industrial distributor with a heavy focus on cutting tools, located in Waukesha, Wisconsin ApTex's strong team of sales engineers, combined with our breadth of products and best-in-class metalworking offering, strengthen our technical expertise and ability to gain market share.

第二個新成員是ApTex，這是一家以生產為導向的工業經銷商，專注於切削刀具，位於威斯康辛州沃克夏ApTex 強大的銷售工程師團隊結合我們廣泛的產品和一流的金屬加工產品，增強了我們的技術實力獲得市場份額的專業知識和能力。

We plan to seamlessly integrate ApTex and further strengthen our regional market position as we did with the fiscal '22 acquisition of Engman-Taylor. The entire MSC team welcomes both Premier Tooling Group and ApTex, and we're looking forward to our future success.

我們計劃無縫整合 ApTex 並進一步加強我們的區域市場地位，就像我們在 22 財年收購 Engman-Taylor 時所做的那樣。整個 MSC 團隊歡迎 Premier Tooling Group 和 ApTex，我們期待未來的成功。

As it relates to Carr Industrial, which we acquired in the fiscal second quarter, I'm pleased to share that integration is going as planned. In fact, we've already begun receiving proposal requests from some of Carr's largest customers to cover the entirety of their MRO and metalworking needs, as Carr now has access to MSC's full breadth of products.

由於它與我們在第二財季收購的卡爾工業有關，我很高興地告訴大家，整合正在按計劃進行。事實上，我們已經開始收到 Carr 一些最大客戶的提案請求，以滿足他們的全部 MRO 和金屬加工需求，因為 Carr 現在可以使用 MSC 的全系列產品。

Before I hand it over to Kristen, I'll spend a few moments discussing the current environment. As we mentioned a couple of weeks ago, conditions remain soft, especially in metalworking-related end markets, such as heavy machinery and equipment and fabricated metals. The softness is reflected in recent readings of the IP, sentiment surveys such as the MBI, and in our estimated June growth rate, which is in line with our revised outlook.

在將其交給克里斯汀之前，我將花一些時間討論當前的環境。正如我們幾週前提到的，情況仍然疲軟，特別是在金屬加工相關的終端市場，例如重型機械和設備以及金屬製品。這種疲軟反映在最近的 IP 數據、MBI 等情緒調查以及我們估計的 6 月成長率中，這與我們修訂後的前景一致。

Looking at growth by customer types, the softness is most notably felt in our core customer base, many of whom are heavily exposed to metalworking manufacturing. Our national accounts program continues to show resiliency, aided by the success of solutions, including our vending and implant programs.

從客戶類型的成長來看，我們的核心客戶群最明顯地感受到了疲軟，其中許多人大量從事金屬加工製造。在解決方案（包括我們的自動販賣機和植入計畫）的成功幫助下，我們的國民帳計畫繼續表現出彈性。

With that, I'll now turn things over to Kristen.

這樣，我現在就把事情交給克莉絲汀。

Thank you, Eric, and good morning, everyone. Please turn to slide 7, where you can see key metrics for the fiscal third quarter on both a reported and adjusted basis.

謝謝你，艾瑞克，大家早安。請參閱投影片 7，您可以在其中查看第三財季報告和調整後的關鍵指標。

Fiscal third quarter sales of $979 million declined 7.1% year over year on an average daily sales basis and includes an approximately 300-basis point headwind related to non-repeating public sector orders in the prior year. The remaining 400 basis points of the year over year declines was primarily driven by lower volumes which was partially offset by benefits from acquisitions.

第三財季銷售額為 9.79 億美元，以日均銷售額計算，年減 7.1%，其中包括與上一年非重複公共部門訂單相關的約 300 個基點的逆風。其餘 400 個基點的年減主要是由於銷售下降造成的，但銷售下降部分被收購帶來的收益所抵銷。

Sequentially, we experienced an improvement of approximately 3%, largely driven by higher volumes. However, this performance was below our expectations due to lower pricing benefits related to the issues from our web price realignment, which have been addressed, and a slower ramp in our core customer base.

隨後，我們的業績成長了約 3%，這主要是由於銷量增加。然而，這一業績低於我們的預期，因為與我們已解決的網路價格調整問題相關的定價效益較低，以及我們的核心客戶群成長速度較慢。

By customer type, national accounts declined 1% year over year. When considering continued softness in the larger portions of our end market exposure and only 43 of our top 100 accounts showing growth, I'm encouraged by the resiliency displayed here.

按客戶類型劃分，國民帳戶較去年同期下降 1%。考慮到我們大部分終端市場敞口持續疲軟，而且 100 個排名前 100 的帳戶中只有 43 個出現增長，我對這裡表現出的彈性感到鼓舞。

Core and other customers declined approximately 7%, driven by macro softness and delays in the rollout of our web enhancement, which are expected to re-energize this customer base in conjunction with our web price realignment actions. The public sector declined approximately 25% due to large, non-repeating orders in the prior year. Excluding this impact, public sector would have shown year-over-year growth in the quarter.

由於宏觀疲軟和網路增強推出的延遲，核心和其他客戶下降了約 7%，預計這將與我們的網路價格調整行動一起重新啟動該客戶群。由於上一年的大量非重複訂單，公共部門下降了約 25%。排除此影響，公共部門本季將出現年增。

Sequentially, average daily sales improved across all customer types, including public sector in the mid to high teens. From a solution standpoint, we continued momentum in the quarter, despite ongoing manufacturing softness.

隨後，所有客戶類型的平均每日銷售額都有所提高，其中包括中十幾歲的公共部門。從解決方案的角度來看，儘管製造持續疲軟，但我們在本季繼續保持成長勢頭。

In vending, Q3 average daily sales improved 2% year over year and represented 17% of total company net sales. Sales through our in-plant programs grew approximately 4% year over year and represented approximately 16% of total company net sales. This was supported by healthy rates of [signings] across both solutions during the quarter, as seen by the year-over-year growth in our installed base.

在自動販賣機領域，第三季每日均銷售額年增 2%，占公司總淨銷售額的 17%。透過我們的廠內計畫實現的銷售額年增約 4%，約占公司總淨銷售額的 16%。這得益於本季兩種解決方案的健康[簽約]率，從我們安裝基礎的年成長率可以看出。

Moving to profitability for the quarter, our gross margin of 40.9% improved 20 basis points year over year. Sequentially, however, gross margin declined 60 basis points from 2Q levels and was below our expectations. This was driven by two primary factors that were roughly the same in size. The first being customer mix that was predominantly public sector driven and headwinds stemming from issues related to our web price realignment that we believe have been addressed.

談到本季的獲利能力，我們的毛利率為 40.9%，年比提高了 20 個基點。然而，毛利率較第二季下降了 60 個基點，低於我們的預期。這是由兩個大小大致相同的主要因素所驅動的。第一個是主要由公共部門驅動的客戶組合，以及與我們的網路價格調整相關的問題所帶來的阻力，我們認為這些問題已經解決。

Both reported and adjusted operating expenses for the quarter were approximately $289 million. On an adjusted basis, operating expenses declined by approximately $1 million year over year, primarily driven by productivity and lower variable incentive compensation that more than offset labor inflation and strategic investments.

該季度報告和調整後的營運費用約為 2.89 億美元。調整後的營運費用年減約 100 萬美元，主要是由於生產力和可變激勵薪酬的降低，這足以抵消勞動力通膨和戰略投資。

Reported operating margin for the quarter was 10.9% compared to 12.8% in the prior year. On an adjusted basis, operating margin of 11.4% declined 170 basis points compared to the prior year. GAAP earnings per share was $1.27 compared to $1.69 in the prior year period. On an adjusted basis, EPS was $1.33 versus $1.74 in the prior year.

本季度報告的營業利潤率為 10.9%，而去年同期為 12.8%。調整後的營業利益率為 11.4%，較前一年下降 170 個基點。 GAAP 每股收益為 1.27 美元，去年同期為 1.69 美元。調整後每股收益為 1.33 美元，前一年為 1.74 美元。

Turning to slide 8 to review our balance sheet and cash flow performance. We continued to maintain a healthy balance sheet with net debt of approximately $480 million, representing roughly one-time EBITDA. Working capital was a favorable source of cash in the quarter, including a contribution of roughly $20 million from inventory reduction. This resulted in another strong quarter of operating cash flow, with conversion of 201% in 3Q and 160% fiscal year to date, keeping us on track to exceed our full-year target of greater than 125%.

轉向投影片 8 回顧我們的資產負債表和現金流表現。我們繼續保持健康的資產負債表，淨債務約 4.8 億美元，相當於一次性 EBITDA。營運資金是本季有利的現金來源，其中包括庫存減少帶來的約 2,000 萬美元的貢獻。這導致營運現金流又一個強勁的季度，第三季度的轉換率為 201%，本財年迄今的轉換率為 160%，使我們有望超越超過 125% 的全年目標。

Capital expenditures during the quarter of approximately $30 million increased to $6 million year over year primarily driven by strategic investments and ongoing solutions growth. Together, this drove strong free cash flow generation of approximately $114 million in fiscal 3Q and $230 million fiscal year to date.

本季的資本支出約為 3,000 萬美元，年增至 600 萬美元，這主要是由於策略性投資和持續的解決方案成長所致。這共同推動了第三財季約 1.14 億美元的自由現金流和本財年迄今約 2.3 億美元的強勁自由現金流。

Our balance sheet and cash generation remain strong and continues to fuel our capital allocation priorities shown on slide 9. We deployed cash in several of these buckets during the quarter, including the strategic acquisitions of Premier Tooling Group and ApTex that Eric mentioned earlier. We also have approximately 2.1 million shares remaining on our current authorization.

我們的資產負債表和現金產生能力仍然強勁，並繼續推動我們的資本配置優先事項（如幻燈片9 所示）。 Tooling Group 和ApTex 的策略性收購。我們目前的授權還剩餘約 210 萬股。

Turning to slide 10, we are maintaining the updated outlook we presented during our preliminary call in June. As a reminder, this revised outlook assumes average daily sales declining 4.7% to 4.3% year over year, adjusted operating margin of 10.5% to 10.7%, and includes impacts from recent acquisitions. Other items embedded in our outlook are included on the slide.

轉向投影片 10，我們維持 6 月初步電話會議中提出的最新展望。需要提醒的是，本次修訂後的展望假設日均銷售額年減 4.7% 至 4.3%，調整後營業利潤率為 10.5% 至 10.7%，並包括近期收購的影響。幻燈片中包含了我們展望中嵌入的其他內容。

Before I turn the call back over, I will spend a few moments discussing what the midpoint of our annual outlook implies for the fourth quarter. Starting with sales, we have one fewer selling day sequentially in 4Q and expect average daily sales to fall within a range similar to 3Q levels. As we discussed during our June call, we expect 4Q gross margins to perform at or slightly better than the historical 3Q to 4Q sequential decline of approximately 40 to 50 basis points.

在我轉回電話之前，我將花一些時間討論我們的年度展望中點對第四季的影響。從銷售額開始，我們第四季的銷售日數比上一季減少了一個，預計日均銷售額將下降到與第三季水準相似的範圍內。正如我們在 6 月的電話會議中討論的那樣，我們預計第四季度的毛利率將達到或略好於歷史上第三季至第四季連續下降約 40 至 50 個基點的水平。

As Eric previously mentioned, following our corrective actions, June's gross margin trend is performing in line with this expectation. Adjusted operating expenses are expected to step up $8 million to $10 million from the third quarter. This is driven by an increase in variable compensation expense due to non-repeating benefits that occurred in the third quarter of roughly $4 million. Costs from strategic investments, higher depreciation and amortization, and recent acquisitions represent the remaining [$46 million].

正如 Eric 先前提到的，在我們採取糾正措施後，6 月的毛利率趨勢表現符合這一預期。調整後的營運費用預計將比第三季增加 800 萬美元至 1,000 萬美元。這是由於第三季發生的約 400 萬美元的非重複性福利導致可變薪資費用增加。剩餘的成本來自戰略投資、較高的折舊和攤銷以及最近的收購[4,600 萬美元]。

And with that, I will now turn the call back over to Eric.

現在，我將把電話轉回給埃里克。

Thank you, Kristen. This was a challenging quarter in what has been a tough fiscal year for MSC. Since our update call a little over two weeks ago, we've been heads down driving corrective actions to improve performance. And I've been encouraged by how our team is rallying in response.

謝謝你，克里斯汀。對 MSC 來說，這是艱難的財政年度充滿挑戰的季度。自從兩週前召開更新電話會議以來，我們一直在努力採取糾正措施以提高效能。我們團隊的團結應對令我深受鼓舞。

We believe this progress will begin bearing fruit during fiscal 2025 and strengthen our position to achieve our long-term targets, which include sales growth of at least 400 basis points above IP over the cycle and adjusted operating margins in the mid-teens.

我們相信，這項進展將在2025 財年開始結出碩果，並鞏固我們實現長期目標的地位，其中包括整個週期內銷售成長至少比IP 高400 個基點，以及調整後的營業利潤率在15%左右。

With that, we'll now open up the line for questions.

現在，我們將開放提問熱線。

(Operator Instructions) Tommy Moll, Stephens Inc.

（操作員說明）Tommy Moll，Stephens Inc.

I wanted to follow up on some of the end market commentary, particularly around heavy manufacturing and just see if there's any way to get a sense of when we might bottom here. I think it's fair to say going into 2024 across the market, volumes were set to decline.

我想跟進一些終端市場評論，特別是有關重型製造業的評論，看看是否有任何方法可以了解我們何時可能觸底。我認為可以公平地說，進入 2024 年，整個市場的銷售量都將下降。

But just given some of the high-profile reductions and outlooks from big public bellwethers as recently as May, plus just observing the sales trends that you've seen more recently, it feels like we took another step down this spring. And so I'm just curious for any insight you have from your customers or sales force.

但考慮到最近 5 月大型公共領頭羊的一些高調削減和展望，再加上您最近看到的銷售趨勢，感覺我們今年春天又邁出了一步。因此，我很好奇您從客戶或銷售人員那裡獲得的任何見解。

Tommy, look, I think you summed it up well. It does feel like things have softened further and you can look no further than yesterday's MBI reading as another proof point in line with what you're saying. I would say in terms of visibility, Tommy -- and by the way, definitely what we're seeing and experiencing is that the softness is more acute in metalworking-related end markets. So you think machinery, equipment, metal fabrication, kind of like art core, which is part of what's going on with our core customer, the closer you get to the core, the softer things appear.

湯米，聽著，我認為你總結得很好。確實感覺事情已經進一步軟化，你只需看看昨天的 MBI 讀數就可以作為與你所說的相符的另一個證據。湯米，我想說的是，就可見度而言，順便說一句，我們所看到和經歷的情況是，金屬加工相關終端市場的疲軟程度更為嚴重。所以你認為機械、設備、金屬製造，有點像藝術核心，這是我們核心客戶正在發生的事情的一部分，你越接近核心，東西就越柔軟。

So I would say, Tommy, visibility is in our business. It's generally pretty limited because we are such a short-cycle business. It's probably more limited than usual. Certainly, gearing up towards an election probably isn't helping things. You've got a lot of people in wait-and-see mode, Tommy, and that combined with interest rates not being reduced, people are cautious.

所以我想說，湯米，可見性是我們的業務。它通常非常有限，因為我們是一家週期短的企業。它可能比平常更有限。當然，為選舉做準備可能無濟於事。湯米，很多人都在觀望，再加上利率沒有降低，人們很謹慎。

So not a lot of visibility. Certainly, beyond November, I think that will be the next big milestone coming at -- look, what I will say is, bigger picture, if you zoom out, things are soft right now. We still feel really good about where we're positioned with North American manufacturing. All the things that we talked about coming out of COVID, the reshoring trends, the strengthening North American manufacturing footprint, we still feel very confident in. Near-term, though, for sure, there is more softness and limited visibility.

所以能見度不高。當然，在 11 月之後，我認為這將是下一個重大里程碑——看，我要說的是，從更大的角度來看，如果你縮小範圍，現在情況很疲軟。我們仍然對我們在北美製造業的定位感到非常滿意。我們談論的所有事情都源自於新冠疫情、回流趨勢、北美製造業足跡的加強，我們仍然對此充滿信心。

And I suppose a related topic here is on pricing, where after the pre-announce, I think you intended to communicate that some of the hiccups you experienced in the quarter were purely driven by execution factors and not a broader marketplace pressure on pricing. But I did just want to double-click on the latter there and anything you've seen in the market that might suggest something broader than what you just experienced internally. Thank you.

我想這裡的一個相關主題是定價，在預先公告之後，我認為您打算傳達的是，您在本季度經歷的一些問題純粹是由執行因素驅動的，而不是更廣泛的市場對定價的壓力。但我只是想雙擊後者，以及您在市場上看到的任何可能暗示比您剛剛在內部經歷的更廣泛的事情。謝謝。

Yeah, sure, Tommy. And yeah, look, you're right. Q3, we had identified of that 60 bps, just as a refresh for you and the rest of the callers. It was about 50-50 between, roughly between a mixed factor and then execution on the list price repositioning. So the work that I've been describing in the company that Kristen talked about we're seeing in June, that's execution and shoring things up, and we feel good about that.

是的，當然，湯米。是的，你看，你是對的。第三季度，我們已經確定了 60 bps，只是為了讓您和其他來電者刷新一下。大約是 50-50 之間，大致介於混合因素和執行標價重新定位之間。因此，我在克里斯汀談到的公司中所描述的工作是我們在 6 月看到的，那就是執行和支持，我們對此感覺良好。

In terms of the pricing environment more generally, it's interesting because you sort of have two competing factors going on, I'd say. On the one hand, no question, inflation has proven to be a bit stickier than expected. So there are some pockets where costs remain elevated. And look, we'll plan to react accordingly where those pockets exist.

就更普遍的定價環境而言，這很有趣，因為我想說，有兩個相互競爭的因素正在發生。一方面，毫無疑問，通貨膨脹已被證明比預期的更具黏性。因此，有些地方的成本仍然很高。看，我們將計劃在這些口袋存在的地方做出相應的反應。

At the same time, we're seeing a phenomenon that we've seen -- I've seen pretty much through my career, it happens like clockwork. Every time the demand environment softens, customers have more time to shop. And so there are more scrutinists of everything that goes out the door. There's more reopening of RFPs.

同時，我們看到了一個我們已經看到的現象——我在我的職業生涯中已經看到了很多，它的發生就像發條一樣。每次需求環境疲軟時，顧客就有更多時間購物。因此，對所有發生的事情都有更多的審查者。有更多的 RFP 重新開放。

So on the one hand, you have a little bit stickier inflation, which should buoy the pricing environment. On the other hand, the competitive environment is intense when it's soft. I will say in a lot of ways, that plays really well into our value proposition. So all of the high-touch stuff that we talked about that's working, and you could see the proof points there in in-plant and vending, a lot of those wins happen because our customers right now are starved for productivity and tangible cost savings, and that's where we can shine, and we can deliver.

因此，一方面，通膨有點黏性，這應該會提振定價環境。另一方面，競爭環境越軟，競爭就越激烈。我想說，從很多方面來說，這都非常符合我們的價值主張。因此，我們談到的所有高接觸性的東西都在起作用，你可以在工廠內和自動販賣機中看到證據，其中許多勝利都是因為我們的客戶現在渴望生產力和切實的成本節約，這就是我們可以發光發熱、我們可以實現目標的地方。

So right now, even our vending and in-plant numbers, those growth numbers are really subdued compared to what we're used to, and I think that's reflective of the environment. When things turn, we should see that lift. But hopefully that gives you a flavor of how we would size up the pricing environment.

所以現在，即使是我們的自動販賣機和工廠內的數量，與我們習慣的相比，這些成長數字也確實很低，我認為這反映了環境。當事情發生轉變時，我們應該會看到這種提升。但希望這能讓您了解我們如何評估定價環境。

David Manthey, Baird.

大衛曼蒂，貝爾德。

Referencing slide number 4, you note that conditions were worse in the metalworking and machinery elements of IP. But looking at the data, it doesn't seem like MSC really outperformed those subcomponents of the index by 400 basis points either, and I understand the web pricing situation and the government year-to-year comp.

參考第 4 號投影片，您注意到 IP 的金屬加工和機械部分的情況更糟。但從數據來看，MSC 的表現似乎也沒有真正超過指數的這些子成分 400 個基點，而且我了解網路定價情況和政府的逐年比較。

But it seems like something changed between the fourth quarter of last year and the first quarter of this fiscal year when the company suddenly stopped outperforming the IP benchmark. Is there anything you can point to that changed in terms of your approach or something at the company that's different relative to that outperformance expectation?

但從去年第四季到本財年第一季度，情況似乎發生了變化，該公司突然不再跑贏智慧財產權基準。您能否指出您的方法發生了哪些變化，或者公司的某些方面相對於優異的業績預期有所不同？

Dave, I would point to two. Look, there's no question you're right, that you look at the past three quarters and growth relative to IP, even relative to the sub-indices, is not what we would expect and not consistent with the performance we had.

戴夫，我想指出兩個。看，毫無疑問你是對的，你看看過去三個季度，相對於知識產權的增長，甚至相對於分項指數的增長，都不是我們所期望的，也與我們的表現不一致。

I think there's two things going on, and one is macro, and one is micro. The macro factor is the heavier rotation for us into markets that are particularly soft. Like, the recent MBI readings are pretty breathtaking, and I think indicative of softness and customers pulling back on spent. I think that's one.

我認為有兩件事正在發生，一是宏觀的，一是微觀的。宏觀因素是我們更頻繁地轉向特別疲軟的市場。例如，最近的 MBI 讀數非常驚人，我認為這表明經濟疲軟和客戶減少支出。我想那就是其中之一。

And then, two, no question that where we're underperforming, Dave, as in the core customer where we look to re-energize. And I would go back to there -- what changed, it would just be the execution on the couple of initiatives we called out during the preliminary release that we were relying on to improve our turbocharged performance that had been delayed.

然後，戴夫，第二，毫無疑問，我們在哪些方面表現不佳，就像我們希望重新註入活力的核心客戶一樣。我會回到那裡 - 發生了什麼變化，這只是我們在初步發布期間提出的幾項舉措的執行，我們依靠這些舉措來提高已被推遲的渦輪增壓性能。

So from our standpoint, this is a timing issue. I think we've taken some good steps here. But those are the two things. I think one is macro and one is micro.

所以從我們的角度來看，這是一個時間問題。我認為我們在這裡採取了一些好的步驟。但這是兩件事。我認為一是宏觀，一是微觀。

Okay, thanks for that, Erik. Second, on the acquisitions that you've announced, could you address the multiples you're paying for these? I assume you're paying less than your own EBITDA multiple for these acquisitions.

好的，謝謝你，艾瑞克。其次，對於您已宣布的收購，您能否說明您為此支付的費用的倍數？我假設您為這些收購支付的費用低於您自己的 EBITDA 倍數。

And just a broader question, why are you making acquisitions while you're in the midst of this sort of mission-critical playbook and having submissions and things? It seemed like it would be a good time to focus internally. Could you just talk about that relative to share repurchase, frankly?

還有一個更廣泛的問題，為什麼在你處於這種關鍵任務劇本並提交意見書之類的時候還要進行收購？看來現在是專注於內在的好時機。坦白說，您能否談談與股票回購相關的問題？

Yeah, sure, Dave. So let me address M&A first, and then I'll address share repurchase, and I think your broader question on capital allocation.

是的，當然，戴夫。因此，讓我先解決併購問題，然後我將解決股票回購問題，我認為您關於資本配置的更廣泛問題。

So why M&A now? I think, look, your point is a fair one. And certainly, I think at the moment, given the fixes going on inside of the company, I don't think you should expect to see us do anything that's really big and outside of our core business.

那為什麼現在要進行併購呢？我認為，看，你的觀點是公平的。當然，我認為目前，考慮到公司內部正在進行的修復，我認為你不應該期望看到我們做任何真正大的、超越我們核心業務的事情。

So where you're seeing us acquire is tuck-in businesses that are into our core, where we do feel like we have a good playbook and a good track record that's building, really building over the past several years now with many of the recent, and we mentioned one or two on the call. So these are businesses that we know, spaces that we know.

因此，你看到我們收購的是我們核心的業務，我們確實覺得我們有一個很好的劇本和正在建立的良好業績記錄，確實是在過去幾年裡建立的，現在有許多最近的，我們在電話中提到了一兩通。所以這些是我們所了解的業務、我們所了解的空間。

Regarding multiples, obviously, it's tricky to talk publicly on the multiples. But from a financial standpoint, suffice it to say that when we're doing these deals, we look at a couple of different criteria. One is we would like to see earnings accretion within the first full year. The second is we want to see returns on capital in excess of our weighted average cost of capital in three years or less.

關於倍數，顯然，公開談論倍數是很棘手的。但從財務角度來看，只要說當我們進行這些交易時，我們會考慮幾個不同的標準。一是我們希望在第一個全年內看到收入成長。第二是我們希望看到資本報酬率在三年或更短的時間內超過我們的加權平均資本成本。

So if we're going to be doing an acquisition, it's going to be meeting those hurdles financially. As I said, operationally, the playbook here is pretty good because these are right into our core. They're giving us market share. They're giving us talent. They're enabling us to leverage current customer relationships. They're enabling us to leverage our product offering. So these are right in our sweet spot.

因此，如果我們要進行收購，就必須克服這些財務障礙。正如我所說，從操作上來說，這裡的劇本非常好，因為這些都是我們的核心。他們給了我們市場佔有率。他們為我們提供了人才。它們使我們能夠利用當前的客戶關係。它們使我們能夠利用我們的產品。所以這些正是我們的最佳選擇。

So I think if this were something that were really bigger and outside what we know how to do, I think I would agree with you. But these are good.

所以我想如果這是一件真正更大的事情並且超出了我們知道如何做的範圍，我想我會同意你的觀點。但這些都很好。

Relative to share repurchase, look, we've articulated the handful of priorities on capital allocation. Kristen mentioned our cash generation has been strong this year. I think that's one area where we have executed well. So I wouldn't be -- given the size of these deals that we're doing that they need to come at the expense of an alternative use of capital.

相對於股票回購，我們已經闡明了資本配置的一些優先事項。克里斯汀提到，今年我們的現金生成能力強勁。我認為這是我們執行得很好的領域。所以我不會——考慮到我們正在進行的這些交易的規模，它們需要以犧牲資本的替代用途為代價。

Ken Newman, KeyBanc Capital Markets.

肯紐曼，KeyBanc 資本市場。

I just wanted to circle back to the sequentially stable ADS guide from 3Q to 4Q. Just to clarify, Eric, I mean, you did highlight some of the deterioration that we're seeing in the macro, whether it's ISM or the MBI here earlier this week. What gives you confidence in that guide kind of being stable from 3Q to 4Q, given some of those macro deterioration? Is that primarily just reflecting the web price issues being fixed? Or is there something else there?

我只是想回到從第三季到第四季連續穩定的 ADS 指南。艾瑞克，我想澄清一下，您確實強調了我們在宏觀經濟中看到的一些惡化，無論是 ISM 還是 MBI 本週早些時候。考慮到宏觀經濟惡化，是什麼讓您相信指南從第三季到第四季保持穩定？這是否主要反映了網路價格問題正在解決？或是還有其他東西嗎？

I think, Ken, it's really just a function of what we're seeing in the trending of the business, to be honest. So when we're giving a forecast, we're not banking on any massive change. So the web -- the pricing corrective actions, where you're going to see that evidence is in stability and gross margin that Kristen talked about, in terms of having a counting on, if you will, a major inflection in our core customer absent the macro.

肯，說實話，我認為這實際上只是我們在業務趨勢中看到的函數。因此，當我們做出預測時，我們並不指望發生任何巨大的變化。因此，在網路上——定價糾正措施，你會看到克里斯汀談到的穩定性和毛利率的證據，如果你願意的話，可以指望我們的核心客戶缺席的重大變化宏。

In the prepared remarks, I really pointed to Q2, where you'd see a convergence of what we expect to have the website really ready for prime time, combined with a marketing campaign that will then feature the web pricing, and all these things should work synergistically. So we're not counting on anything, any massive change in Q4, but more looking at trending and typical seasonal patterns.

在準備好的演講中，我確實指出了第二季度，您會看到我們期望網站真正為黃金時段做好準備的融合，再加上以網絡定價為特色的營銷活動，所有這些都應該協同工作。因此，我們不指望第四季度的任何重大變化，而是更關注趨勢和典型的季節性模式。

Okay. And then for my follow-up, Kristen, I think in the past, you've talked about this idea that every point of ADS growth is around 20 basis points of EBIT margin. There's obviously some impact on the fourth quarter that makes that math a little fuzzier. But from a higher level, I'm just curious if that framework still holds true as we think about fiscal '25 and whatever that recovery look like?

好的。然後，對於我的後續行動，克里斯汀，我想您過去曾談到過這樣的想法：ADS 的每一個增長點都是息稅前利潤率的 20 個基點左右。顯然，第四季受到了一些影響，使得數學計算變得有點模糊。但從更高的層面來看，我只是好奇，當我們考慮 25 財年以及復甦的情況時，框架是否仍然成立？

Yeah, Ken, so for the year that is what we had communicated back in the Q2 release, obviously, we're pretty far off of that with the revised guidance, and that, of course, has to do with the web pricing challenges we've had, the timing of the core ramp up.

是的，肯，所以今年這就是我們在第二季度發布中傳達的內容，顯然，我們距離修訂後的指導方針還很遠，當然，這與我們面臨的網絡定價挑戰有關。加速的時機。

Beyond '24, it's really too early to say. I know there's going to be a strong demand out there for insight around FY25, especially just given what's happening in the macro environment, what kind of -- what we can see and what we have line of sight to. But generally, it's really still too early for us to say.

24 年後，現在說還太早。我知道人們對 25 財年的洞察力會有強烈的需求，特別是考慮到宏觀環境中正在發生的事情、我們能看到什麼以及我們能看到什麼。但總的來說，現在說還太早。

On the top line, of course, we are very short cycle, and that's, I'd say, even in a normal demand environment condition, certainly in the situation we're in. Today, with the macro uncertainty that makes it even a little bit harder to predict.

當然，從總體上看，我們的周期非常短，也就是說，即使在正常的需求環境條件下，當然也是在我們所處的情況下。 。

And then on gross margins, like if I just kind of walked down the P&L to try to at least get some color into '25, we are really pleased with the way that gross margins have been trending in 4Q, especially the recovery that we're seeing post-web-price realignment issues. But again, it's a lot of moving pieces. We've got the stabilization of the web price. Timing of core customer recovery is a big piece of that.

然後在毛利率方面，就像我只是沿著損益表嘗試至少在 25 年中獲得一些色彩一樣，我們對第四季度毛利率的趨勢非常滿意，尤其是我們的復甦重新看到網絡後價格調整問題。但同樣，這是很多移動的部分。我們已經實現了網路價格的穩定。核心客戶恢復的時機是其中很重要的一環。

And then, of course, what happens with mix with respect to the customer type growth in public sector and national accounts. One thing I can give you is a little bit more direct color on with OpEx, though, specific to '25 in the first quarter. I do think it's important to note that we have line of sight to a sequential step-up in OpEx Q4 to Q1, and that has to do with the resetting of the variable compensation programs to the new fiscal year and a step-up in DNA.

當然，公共部門和國民帳戶中客戶類型增長的混合會發生什麼。不過，我可以給您的一件事是對營運支出的更直接的描述，具體針對第一季的 25 年。我確實認為值得注意的是，我們預計第四季度到第一季營運支出將連續提升，這與新財年可變薪酬計畫的重置以及 DNA 的提升有關。

So I know that's a small bit of specific information for '25, but hopefully that leaves us with a finer point on OpEx for the first quarter. And then we will follow up with more insight on the year when we do the Q4 release and try to share as much as we can about guidance for '25 at that time.

所以我知道這只是 25 年的一小部分具體訊息，但希望這能讓我們對第一季的營運支出有更好的了解。然後，當我們發布第四季度時，我們將跟進更多關於這一年的見解，並嘗試盡可能多地分享當時 '25 的指導。

Chris Dankert, Loop Capital.

克里斯·丹克特，Loop Capital。

First off, Erik, I know that you had the largest deal in recent memory here, but congrats on adding ApTex and a really solid team there in Waukesha. I guess just first off here, thinking about the big marketing push after we kind of get through the web reset here, is there any historical precedent or any kind of reads from pilot programs in terms of how long it takes to kind of get the juice from that marketing push?

首先，Erik，我知道您在這裡達成了近期記憶中最大的一筆交易，但恭喜您在沃科夏增加了 ApTex 和一支非常可靠的團隊。我想首先，考慮一下我們在這裡完成網絡重置後的大規模營銷推動，是否有任何歷史先例或任何從試點項目中獲得的關於需要多長時間才能獲得效果的讀物來自營銷推動？

Yeah, Chris, that's a good question. So I can tell you that there is no direct analogy to draw from, and I know what you're getting at, is what can we expect in a lift. What I will tell you is from a marketing standpoint, while the campaign will be new, many of the tactics that we'll use in terms of digital marketing, print marketing, and personal outreach are tried and true. It'll be a new combination and a new message, but the means by which we're getting to customers are means that we are very familiar with and do have a track record with.

是的，克里斯，這是個好問題。所以我可以告訴你，沒有直接的類比可以藉鏡，我知道你的意思是我們對電梯的期望。我要告訴你的是，從行銷的角度來看，雖然該活動將是新的，但我們將在數位行銷、印刷行銷和個人推廣方面使用的許多策略都經過嘗試且真實。這將是一個新的組合和新的訊息，但我們接觸客戶的方式是我們非常熟悉並且確實有記錄的方式。

If what you're looking for is more kind of a specific quantitative inflection. It's a tough one to give you, and it's tough in particular because who knows what the world's going to look like by the time we get to Q2. And it's sort of tough to predict, but I do think -- I think the other thing I'll say, by the way, Chris, beyond the marketing campaign, is we do expect improvements in the website.

如果您正在尋找更多的是特定的定量變化。這是一個艱難的任務，尤其是因為誰知道當我們進入第二季時世界會是什麼樣子。這有點難以預測，但我確實認為——順便說一句，克里斯，我想我要說的另一件事是，除了行銷活動之外，我們確實期望網站得到改進。

There's some betting on the come with marketing. But improvements in the website should -- there are quantitative measures that we're tracking daily that you could see when we see improvements in site effectiveness that yields a higher conversion rate, meaning for every hundred people coming to the website, how many convert into a sale and how big is the sale.

有人押注於行銷的到來。但是網站的改進應該——我們每天都會追蹤一些量化指標，當我們看到網站有效性的改進產生更高的轉換率時，您可以看到這些指標，這意味著每一百人訪問該網站，有多少人轉化為一次銷售以及銷售量有多大。

Those are metrics that we're tracking carefully, and we would fully expect to see read through into revenue improvements on the existing base of business. The marketing campaign reenergizing new customers is a bit trickier to quantify.

這些是我們正在仔細追蹤的指標，我們完全希望能夠深入了解現有業務基礎上的收入改善。重新激發新客戶活力的行銷活動很難量化。

Got it. Got it. Understood. And then just -- I have to follow up here. I guess moving to in-plant, nice to see, the growth is better than kind of overall. I guess maybe just any comments on what the cost to serve looks like in that business relative to what your expectations were. How's the profitability progressing in that piece of the business perhaps?

知道了。知道了。明白了。然後——我必須在這裡跟進。我想轉移到工廠內，很高興看到，成長比整體好。我想也許只是關於該業務的服務成本相對於您的期望的任何評論。該業務的獲利能力進展如何？

Yeah, Chris, so broadly, we're seeing stable performance in the profit for the in-plant customers. There's definitely a difference depending on how mature the in-plant customer is. And that's one of the things that we've been kind of dealing with on the P&L in '24 because the growth has been so high. We have to make that upfront investment in the in-plant resource, take time for the account to ramp up.

是的，克里斯，從廣義上講，我們看到廠內客戶的利潤表現穩定。根據工廠內客戶的成熟程度，一定會有差異。這是我們在 24 年損益表上處理的事情之一，因為成長如此之高。我們必須對廠內資源進行前期投資，需要時間來增加帳戶。

But generally, we've continued to see performance as we expected on those accounts and then really once you hit like the six to nine-month mark, we see really nice stabilization of profit there. The accounts start to reach maturity. And if you look back like kind of by class at the in-plants, which is just how we look at things internally. Once you hit that point of stability, we see a nice contribution margin from the in-plant customer.

但總的來說，我們繼續看到這些帳戶的表現符合我們的預期，一旦達到六到九個月的大關，我們就會看到那裡的利潤非常穩定。帳戶開始到期。如果你回顧工廠內部的班級，這就是我們內部看待事物的方式。一旦達到穩定點，我們就會看到來自工廠內客戶的不錯的邊際貢獻。

Hey, Chris, one thing I'll add just on -- and I'll add for commentary, I think Kristen nailed it on the profitability front. On the growth side, you mentioned, so while in-plant is outperforming the company nicely, I think we said growth in the in-plant program in the quarter was 4%.

嘿，克里斯，我要補充一件事——我會補充評論，我認為克里斯汀在盈利能力方面做到了這一點。在成長方面，您提到，雖然廠內計畫的表現很好地優於公司，但我認為我們說本季廠內計畫的成長為 4%。

I mean, if you look at the first -- Kristen mentioned that there's a ramp in classes of customers, the first year or two with an in-plant, we see explosive growth. So if you go back to our mature classes of customers, growth is well below that. And these are our best customers. Again, I think indicative of market softness that as we continue signing more in-plants, we're building an embedded base of business that as things turn should give us a nice lift.

我的意思是，如果你看一下第一個——克里斯汀提到，客戶類別有所增加，在工廠內的頭一兩年，我們看到了爆炸性增長。因此，如果你回到我們成熟的客戶群，你會發現成長遠低於這個水準。這些是我們最好的客戶。我再次認為，隨著我們繼續簽署更多的工廠內合同，我們正在建立一個嵌入式業務基礎，這表明市場疲軟，隨著情況的轉變，這應該會給我們帶來很大的提升。

Got it. Thanks a lot for the call there.

知道了。非常感謝您的來電。

Yeah. And Chris, one more thing to clarify. I said a nice contribution margin, but to be clear, it is at or above company operating margin at that point.

是的。克里斯還有一件事需要澄清。我說的是一個不錯的邊際貢獻，但要先明確的是，當時的邊際貢獻等於或高於公司的營業利益。

Ryan Merkel, William Blair.

瑞恩·梅克爾、威廉·布萊爾。

I had a couple questions on the web realignment. I guess first off, Erik, what percent of sales are going to see a lower price, and then can you give us a rough range of how much lower prices are for that group of customers?

我對網路調整有幾個問題。我想首先，艾瑞克，有多少百分比的銷售額會看到更低的價格，然後你能給我們一個粗略的範圍，說明該組客戶的價格會降低多少？

So Ryan, in terms of what percentage, if you looked at today's base of business, okay, it would be under half of our business because many of our customers already have negotiated pricing. The opportunity here is both, number one, for that base of existing customers who don't have a negotiated price; and then number two, tapping into a whole new set of business and customers that we don't have. So I think that's point one.

所以瑞安，就百分比而言，如果你看看今天的業務基礎，好吧，這將不到我們業務的一半，因為我們的許多客戶已經協商了定價。對於沒有協商價格的現有客戶群來說，這裡的機會是第一。第二，開拓我們沒有的全新業務和客戶。所以我認為這是第一點。

Point two, in terms of what price the customer will see, it's hard to get -- averages are really deceiving. So I could give you an average, but the average would be entirely misleading. Let me explain what I mean by that. Basically, what we've done is on a item-by-item basis, identified what the range of market looks like. And we wanted to make sure that for all of our items were in that range.

第二點，就客戶將看到的價格而言，很難得到——平均價格確實具有欺騙性。所以我可以給你一個平均值，但平均值會完全誤導。讓我解釋一下我的意思。基本上，我們所做的就是逐項確定市場範圍。我們希望確保我們所有的產品都在這個範圍內。

And so in some cases, that meant that we had to take pricing down considerably. There were other cases where we actually found we were below the range. Obviously, there were more that we were above the range than below the range. But an average would be tricky.

因此在某些情況下，這意味著我們必須大幅降低價格。在其他情況下，我們實際上發現我們低於範圍。顯然，高於該範圍的數量多於低於該範圍的數量。但平均數會很棘手。

I think what we do feel good about is that our customers can feel confident that we're going to have a market credible price, if you will, and be within some bands of reason. Again, the strategy here was not to win business on price. It was to take away cases where we were losing business on price.

我認為我們確實感到滿意的是，我們的客戶可以放心，如果您願意的話，我們將擁有市場可信的價格，並且在一定的合理範圍內。同樣，這裡的策略不是透過價格贏得業務。這是為了消除我們因價格而失去業務的情況。

Okay. No, that makes sense. And really where I'm going with the question is what's the opportunity? What are we going to get? So it sounds like we'll give up a little bit of price vis-a-vis where we were before, but you're -- you think you're going to get the core customers growing high single digits, and then the core customers are also higher gross margin. Just talk about when you get this right, what it means for the P&L.

好的。不，這是有道理的。我真正要問的問題是機會是什麼？我們會得到什麼？因此，聽起來我們會放棄一些與之前相比的價格，但你認為你會讓核心客戶成長高個位數，然後核心客戶就會成長。只要談談當你做對了這件事時，這對損益表意味著什麼。

Yeah. Ryan, and I think you teed it up probably better than we did. I think that's exactly right, and it's why so much of our focus here is on re-energizing the core customer. These customers are certainly higher margin than our average customer, lower cost to serve. And it's not just -- and that was where we wanted to go back to kind of the trifecta of the initiatives of the web pricing, which is really an enabler, if you will, to put us in a, as I said, sort of a reasonable range, and then combine that with a marketing effort and a website.

是的。瑞安，我認為你的準備可能比我們做得更好。我認為這是完全正確的，這就是為什麼我們的重點是重新激活核心客戶。這些客戶肯定比我們的一般客戶利潤更高，服務成本也更低。這不僅僅是——這就是我們想要回到網路定價舉措的三重奏的地方，如果你願意的話，這確實是一個推動者，讓我們陷入一種，正如我所說的，一個合理的範圍，然後將其與行銷工作和網站結合。

And it was why on the last, on the pre-release, Ryan, we were really disappointed and sort of pointed to the website, because without the website being really ready for prime time, if you will, it sort of -- it held us back on the other two initiatives.

這就是為什麼在最後一次預發布中，Ryan，我們真的很失望，並有點指向該網站，因為如果該網站沒有真正為黃金時段做好準備，如果你願意的話，它有點 - 它持有我們回到另外兩項倡議。

So we're pointing to Q2. We feel pretty good right now about progress that's going on, on the website. So you combine those three efforts, and all of a sudden, we take a portion of the business, a big portion of the business that has been diluted to growth rate, even bringing it to company average. Number one, massively improves the growth rate; and then number two, to your point, our company, for the last however many years you've been following us, there's been this built-in gross margin, customer mix headwind because the larger accounts that have been growing faster or lower margin.

所以我們指的是第二季。我們現在對網站上正在取得的進展感到非常滿意。所以你把這三項努力結合起來，突然之間，我們就拿走了一部分業務，很大一部分業務已經被稀釋到增長率，甚至達到了公司的平均水平。第一，大幅提高成長率；第二，就您而言，我們公司，無論您關注我們多少年，都存在固有的毛利率、客戶組合逆風，因為較大的客戶成長更快或利潤率更低。

If that goes away, it opens up a whole new world in terms of incremental margins because all of a sudden there's no longer gross margin dilution, we're leveraging top-line growth, and then layering in some productivity like the supply chain study we mentioned. So thank you for the question.

如果這種情況消失，就增量利潤而言，它會打開一個全新的世界，因為突然間不再有毛利率稀釋，我們正在利用營收成長，然後分層增加一些生產力，例如我們的供應鏈研究提及。謝謝你的提問。

Chirag Patel, Jefferies.

奇拉格·帕特爾，杰弗里斯。

I just wanted to circle back on the M&A for a quick second here. I wanted to get a sense for how much revenue contribution we can think of on an annual basis for the two businesses that were acquired in June, and then whether or not those businesses also are currently performing at the current MRC margin, and maybe the initiatives that are anticipated to maybe even have an outgrow of the form over time.

我只是想在這裡快速回顧一下併購。我想了解我們可以想到 6 月份收購的兩家企業每年能貢獻多少收入，然後這些企業目前是否也能以當前的 MRC 利潤率表現，以及可能採取的舉措隨著時間的推移，預計甚至可能會淘汰這種形式。

Yeah, Chirag, I can take that one. So the annualization of the two we just acquired is a little bit over $20 million. And I think the second part of your question was are they at or above the company operating margin. One is currently above, one is below, which is not atypical on the initial acquisition for some of our bolt-ons. But we are able to quickly bring synergies in place, both on the cost side that usually get that up, depending on the degree to which we have to do the work. Some are faster than others.

是的，奇拉格，我可以接受。所以我們剛收購的兩家公司的年化價值略高於 2,000 萬美元。我認為你問題的第二部分是它們是否等於或高於公司的營業利潤率。目前，一個在上面，一個在下面，這對於我們的一些螺栓的初始採購來說並不罕見。但我們能夠迅速實現協同效應，無論是在成本方面，通常都會提高協同效應，這取決於我們必須完成工作的程度。有些比其他更快。

But the longer-term synergy play, Chirag, on the M&A bolt-ons is on the growth side. And there's typically things that we do kind of on day one to initiate, like cross-sell with the acquired company, for example. That's an area I think we talked about in the prepared remarks that we're having early success with Carr. But then the growth synergy benefit tends to grow incrementally each year the more that we mature where we are post acquisition, like with all of the initiatives that are in place.

但 Chirag 在併購補充上的長期協同作用是在成長方面。通常我們會在第一天就開始做一些事情，例如與被收購公司的交叉銷售。我認為我們在準備好的發言中談到了這個領域，即我們與卡爾的合作取得了早期成功。但是，隨著我們在收購後的成熟度越來越高，成長協同效益往往會逐年遞增，就像所有已實施的措施一樣。

So every acquisition we do is a little bit different, even on the bolt-ons. But these two, I'd say, are very much kind of aligned to the playbook that we run and really low risk in terms of our confidence in getting synergies in line.

因此，我們所做的每一次收購都略有不同，即使是補充性收購也是如此。但我想說，這兩者非常符合我們運行的策略，就我們對實現協同效應的信心而言，風險確實很低。

Got you. And actually, on that playbook front, it's a nice slide to have where it kind of shows you what you're kind of hitting on as far as the M&A criteria go. We're kind of missing on the side growth and market piece of the pie. I wanted to touch on that. I'm going to pause on that for a second. One, just the idea of how much of your business currently is kind of -- in what you would qualify as these high-end growth markets, and then maybe even identifying a couple of them would be helpful as you kind of look at the growth going forward, I guess.

明白你了。事實上，在劇本方面，這是一張很好的幻燈片，它向您展示了就併購標準而言您正在實現的目標。我們有點錯過了側面的成長和市場份額。我想談談這一點。我要暫停一下。一，您目前的業務有多少是屬於這些高端成長市場的想法，然後，當您審視成長時，甚至確定其中的幾個市場可能會有所幫助繼續前進，我想。

Yeah, sure. I'm happy to take that one. So first of all, what I'd say is you see a number of criteria on that slide that we wanted to get across. So the high-growth end markets is one, but there's several others. And the last two and the last several we've done check a number of boxes.

好，當然。我很高興接受那個。首先，我要說的是，您在幻燈片上看到了我們想要傳達的一些標準。因此，高成長的終端市場就是其中之一，但還有其他幾個市場。我們所做的最後兩個和最後幾個檢查了許多方框。

In terms of the high-growth end markets, look, the first thing I'll say is I mentioned a little earlier on, we feel pretty good about being positioned in North American manufacturing. At the moment, it doesn't feel so good when you look at the MBI and we look at maybe the next couple of months here. But if we zoom out and look at the next few years, we do feel like North American manufacturing as a whole is going to be a secular grower, is going to benefit from the post-COVID reshoring trends. So we feel like it's a pretty good place to be.

就高成長終端市場而言，我要說的第一件事是我之前提到的，我們對在北美製造業的定位感到非常滿意。目前，當你查看 MBI 時，感覺不太好，我們可能會關注未來幾個月的情況。但如果我們放眼未來幾年，我們確實認為北美製造業作為一個整體將成為長期成長者，並將受益於新冠疫情後的回流趨勢。所以我們覺得這是一個非常好的地方。

Within that, there's obviously pockets that are growing faster and are projected to grow faster than others. I mean, one certainly would be aerospace that comes to mind that has been, since COVID, on a good trajectory and is projected to continue on a good trajectory.

其中，顯然有一些領域的成長速度更快，並且預計將比其他領域更快成長。我的意思是，自從新冠疫情以來，我想到的肯定是航空航天，它一直處於良好的軌道上，並且預計將繼續保持良好的軌道。

In there, an example would be an acquisition that we did a few years ago, Wm Hearst, which is in Wichita, which is heavily aerospace exposed. That would be an example of one in our portfolio that does check the high-growth end market, if you will. So definitely, it's in our mind, it's part of what we look at, but not the only thing we look at.

舉個例子，我們幾年前收購了 Wm Hearst，該公司位於威奇托，航空航太業嚴重暴露。如果你願意的話，這將是我們投資組合中確實檢查高成長終端市場的一個例子。所以毫無疑問，它就在我們的腦海中，它是我們所看到的東西的一部分，但不是我們所看到的唯一東西。

Understood. And then if you were to qualify the idea of high-growth end markets, how much of your portfolio currently addresses that? And how much -- what do you think would be a good mix longer term?

明白了。然後，如果您要限定高成長終端市場的想法，您的投資組合目前有多少解決了這個問題？從長遠來看，您認為多少才是一個好的組合？

So I would say today, the majority of our -- we talked in the prepared remarks a little bit about the majority. If you look at -- so MSC today is roughly 70% manufacturing. Of that, a good chunk is sitting in end markets that run on high-growth end markets that right now, are weighed down disproportionately, and probably not considered necessarily outgrowing the rest of manufacturing.

所以我今天要說的是，我們的大多數人——我們在準備好的演講中談論了一些關於大多數人的問題。如果你看一下——那麼今天的 MSC 大約有 70% 是製造業。其中很大一部分是在高成長終端市場上運行的終端市場，這些市場目前受到了不成比例的壓力，而且可能不被認為一定會超過其他製造業的成長。

So today, the high-growth end markets would be a minority of the 70%, certainly less than half the 70%. Think aerospace, think medical, think -- there's a couple of other ones that -- just sensitivity reasons, we're not going to call out on the call.

因此，今天，高成長的終端市場將只是這 70% 的少數，當然不到 70% 的一半。想想航空航天、想想醫療、想想——還有其他一些——只是出於敏感性原因，我們不會在電話會議上大聲疾呼。

What I'd say is over time, given the goals that we have for market share capture for MSC, one would think it would be fair to say that our portfolio of business should be somewhat reflective of what the market looks like.

我想說的是，隨著時間的推移，考慮到我們為 MSC 爭取市場份額的目標，人們會認為公平地說，我們的業務組合應該在某種程度上反映市場的情況。

So today, it's a little bit more heavily weighted towards heavy equipment and machinery, metal fabrication, which would be reflective of our job shop type customer. And that over time, we'd like to see the portfolio mirror what the market looks like.

因此，今天，它更注重重型設備和機械、金屬製造，這反映了我們的加工車間類型的客戶。隨著時間的推移，我們希望看到投資組合反映市場的情況。

Patrick Baumann, J.P. Morgan.

派崔克鮑曼，摩根大通。

I had a couple here. One for Kristen -- good morning, Kristen. How are you?

我這裡有一對。送給克里斯汀的——早安，克里斯汀。你好嗎？

Good. How are you?

好的。你好嗎？

I'm good. Just had the first one for you, maybe, on the OpEx. The $8 million to $10 million sequential increase is a bit more than we would have expected. Can you talk about the drivers again into the fourth quarter? And I thought that the Columbus closure impacts things starting in June, but maybe I'm off on timing.

我很好。剛剛為您準備了第一個，也許是在 OpEx 上。 800 萬至 1000 萬美元的環比增幅略高於我們的預期。您能在第四季再次談論車手嗎？我認為哥倫布的關閉會影響六月開始的事情，但也許我的時機不對。

Then you mentioned OpEx up again in the first quarter because of merit. What type of pay increase are you doing? And I thought maybe you would get some headcount reductions from that CFC closure, which would offset some of that. But maybe just some insight into the moving parts. on third quarter to fourth quarter, fourth quarter to first quarter.

然後您提到第一季營運支出由於優點而再次上升。您正在進行什麼類型的加薪？我想也許你會因為 CFC 的關閉而減少一些員工人數，這會抵消其中的一部分。但也許只是對活動部件的一些了解。第三季到第四季，第四季到第一季。

And then the magnitude to think about in terms of step-up marketing costs from first quarter to second quarter, because you said something about second-quarter marketing expenses.

然後考慮從第一季到第二季增加的行銷成本的大小，因為你談到了第二季的行銷費用。

Yeah. Yeah. Happy to walk you through that. Let's start with the Q3 to Q4 sequential. The first factor in there is that we had a benefit in the third quarter related to the variable compensation programs. That benefit is not going to repeat in Q4. That's a step-up of $4 million. And then the balance of the expense sequentially stepped up is -- I'm going to break it down in a few buckets. We've got increased DNA. There's incremental strategic investment tied to primarily the solutions programs. So think like the implant headcount, for example.

是的。是的。很高興引導您完成這一切。讓我們從 Q3 到 Q4 順序開始。第一個因素是我們在第三季獲得了與可變薪酬計劃相關的收益。這種好處不會在第四季重複出現。相當於增加了 400 萬美元。然後，依次增加的費用餘額是——我將把它分成幾個部分。我們的 DNA 增加了。增量策略投資主要與解決方案計劃相關。例如，請考慮植體人數。

And then we have a step-up coming in from the acquisitions that were brought online in June. The net of all those is $4 million to $6 million. When we talked in the third quarter, we had not included the acquisition expense in the sequential step-up. So if you're thinking that the Q4 number is a little bit higher, it is a bit higher than what we articulated in Q3 pre-release call.

然後，我們在 6 月進行的線上收購中取得了進步。所有這些淨額為 400 萬至 600 萬美元。當我們在第三季討論時，我們沒有將收購費用納入連續的升級。因此，如果您認為第四季度的數字要高一點，那麼它比我們在第三季預發布電話會議中闡明的要高一點。

We did not want to get ahead of ourselves on the acquisition announcement, but that was contemplated in the revised full-year operating margin outlook, just to be totally clear.

我們不想在收購公告上操之過急，但這是在修訂後的全年營業利潤率展望中考慮到的，只是為了完全清楚。

Your next question, I think, Pat, was on the Q4 to Q1 change in OpEx. The increase that I mentioned earlier actually does not have to do with typical labor inflation, although that obviously is an element that we'll have to deal with heading into '25. The item I had called out was really specific to the reset of the variable compensation program. Not surprisingly, we're not having a good year.

帕特，我想你的下一個問題是關於營運支出從第四季到第一季的變化。我之前提到的成長實際上與典型的勞動力通膨無關，儘管這顯然是我們進入 25 年後必須處理的因素。我提出的項目實際上是針對可變補償程序的重置的。毫不奇怪，我們今年過得併不好。

Most of the variable comp programs are not paying out. They're not paying out really much at all, so think your sales commission's programs, your corporate bonus program. When those things reset in '25, that becomes a sequential step-up for us, Q4 to Q1.

大多數可變補償計劃都沒有支付。他們根本沒有支付太多，所以想想你的銷售佣金計劃，你的公司獎金計劃。當這些事情在 25 年重置時，這對我們來說是一個連續的升級，從第四季到第一季。

The typical merit increase that we do goes into effect in November, so you don't have as much of an impact in Q1 on that as you do in the later -- the Q1 to Q2 sequential step-up. And I think the last thing you'd asked about in there was some of the productivity initiatives. I think Columbus you called out, and then the voluntary. And you're right, those will benefit '25.

我們所做的典型績效加薪將於 11 月生效，因此第一季對這一點的影響不會像後面那麼大——第一季到第二季的順序加薪。我想你最後問的問題是一些生產力計畫。我想哥倫布是你喊出來的，然後是自願的。你是對的，這些將使 25 歲受益。

Columbus is shutting down in Q4, so not -- you'll get a little pickup in Q1 tied to Columbus. And as a reminder, that's about $5 million to $7 million on annualized savings. And then the voluntary, we're seeing that savings already in the Q4 number, so not as much of an impact Q4 to Q1 sequentially.

哥倫布將在第四季度關閉，所以不會——第一季與哥倫布相關的業務將會回升。提醒一下，每年節省的費用約為 500 萬至 700 萬美元。然後是自願的，我們看到第四季的數字已經節省了，所以對第四季到第一季的影響沒有那麼大。

And then kind of beyond that, the real big one on productivity for us is the rest of the work on the network optimization. Initiatives, Columbus comes online first. The other initiatives will start to kick in more throughout the year, and we'll give some added color on how to think about productivity when we do the Q4 release.

除此之外，對我們生產力來說真正重要的是網路優化的其餘工作。倡議，哥倫布首先上線。其他舉措將在全年中開始發揮更多作用，我們將在發布第四季度版本時就如何考慮生產力提供一些補充。

Is that impacted by the re-evaluation of the digital initiatives, that last thing, in terms of the network optimization, or is that something different?

這是否受到數位計畫重新評估（最後一件事）在網路優化方面的影響，還是有什麼不同？

No, no, no, that's different. So this really has to do, I think, more supply chain and operations focused than network optimization. This is kind of everything from physical footprint, which is where something like Columbus comes in to kind of how we fulfill customer orders.

不不不，那是不同的。因此，我認為，這確實需要更多地關注供應鏈和運營，而不是網路優化。這涉及到從實體足跡到我們如何履行客戶訂單的一切，就像哥倫布一樣。

Okay, and the re-evaluation of the other digital initiatives is related -- like, were there benefits expected from that that are being pushed out, or elaborate on what you said in the preamble on that?

好的，對其他數位計畫的重新評估是相關的——例如，正在推出的計畫是否會帶來預期的好處，或者詳細說明您在序言中所說的內容？

Yeah, on the re-evaluation of the other digital initiatives, no, nothing that would drive benefit in '25. I would say that the big one here is really just around looking at the progress in the digital core program, which is a reminder. That's the expense that you're seeing in -- we kind of call it out in our CapEx guidance, but it's actually in CCA on the balance sheet. So you're going to see -- you're not going to see any impact to the P&L in 25 because of that re-evaluation.

是的，在重新評估其他數位計劃時，不，沒有什麼可以在 25 年帶來效益。我想說，這裡最重要的其實就是關注數位核心計畫的進展，這是一個提醒。這就是您看到的費用——我們在資本支出指南中提到了這一點，但它實際上是在資產負債表上的 CCA 中。所以你會看到——你不會看到 25 年內的損益表因重新評估而受到任何影響。

And again, it is just a re-evaluation, so it doesn't necessarily mean we're doing anything differently. But I think what you're getting at is, is there productivity at all tied to that, or even investment specific to '25, and on the P&L, there's really nothing related to digital core contemplated at this point.

再說一遍，這只是一次重新評估，因此並不一定意味著我們正在做任何不同的事情。但我認為你的意思是，是否有與此相關的生產力，甚至是特定於 25 年的投資，並且在損益表上，目前實際上沒有考慮與數位核心相關的任何內容。

Okay, thanks. And then a couple, I guess, post-mortem questions for Erik, maybe, just trying to understand the timing of this stuff. I mean, it seemed from the outside that the core customer has been underperforming for a long time now. So maybe just help us to understand why the website investment has been so stale for such a long period of time when it's -- you've lagged leaders like Granger on this front probably for many years.

好的謝謝。然後，我想，還有一些對艾瑞克的事後分析問題，也許只是想了解這些東西的時間安排。我的意思是，從外部看來，核心客戶長期以來表現不佳。因此，也許只是幫助我們理解為什麼網站投資在這麼長的一段時間內如此停滯不前——你在這方面可能落後於像格蘭傑這樣的領導者很多年了。

And then also, looking back, why you didn't think you needed to address the web price issue when they did it back in 2017, when you clearly had exposure with the non-contract business within the company?

然後，回想起來，為什麼你不認為你需要解決網路價格問題，而他們在 2017 年就這樣做了，當時你顯然接觸過公司內部的非合約業務？

Pat, good questions. I think that -- first of all, what I would say is I think there has been some degree on the web in particular investment all along. I think what we're looking at now is the step function. And I think what you're seeing is a reflection of choices that we made. We proactively and consciously made a pretty hard pivot, if you recall, over the past several years to move the value proposition into a high-touch technical one.

帕特，好問題。我認為，首先，我想說的是，我認為網路上一直存在著一定程度的特別投資。我認為我們現在關注的是階躍函數。我認為你所看到的反映了我們所做的選擇。如果你還記得的話，在過去的幾年裡，我們主動、有意識地做出了一個相當艱難的轉變，將價值主張轉變為高接觸性的技術主張。

And so like every company, there's choices that we make about where we're going to invest. We're mindful of how much we invest at any one time and the need to produce financial performance. And so a lot of our investments went into the areas that we're now highlighting are actually doing quite well. And we did those by design.

因此，像每家公司一樣，我們對投資方向做出選擇。我們時時刻刻關注我們在任何時候的投資金額以及產生財務表現的需要。因此，我們的許多投資都投入了我們現在強調的實際上表現良好的領域。我們是有意這麼做的。

And so I think for us now, we're turning our attention knowing that that portion of the business, the high-touch is working, and it's now the tip of the spear for us. And how we win an account, this is now -- we're now following it up behind it with the core customer.

所以我認為現在對我們來說，我們正在轉移注意力，因為我們知道這部分業務，高接觸性正在發揮作用，而且它現在是我們的矛尖。我們如何贏得客戶，這就是現在——我們現在正在與核心客戶一起跟進。

I mean -- cadence-wise, obviously, the solutions business is performing really well. So totally get that, and those investments are bearing fruit. So this was more of kind of a prioritization of things as opposed to you not recognizing that there were things that needed to be addressed with the core.

我的意思是——從節奏來看，顯然，解決方案業務的表現非常好。所以完全明白這一點，這些投資正在取得成果。因此，這更像是事情的優先順序，而不是你沒有意識到有些事情需要用核心來解決。

No, I think that's right. I think both from a capacity inside the company of how much would we get done at one time and a capacity on the P&L of how much can we absorb in terms of investment, those were choices we made.

不，我認為這是對的。我認為，無論是從公司內部的能力（我們一次能完成多少工作）或是從損益表的能力（我們可以吸收多少投資）來看，這些都是我們所做的選擇。

This concludes our question-and-answer session. I would like to turn the conference back over to Ryan Mills for any closing remarks.

我們的問答環節到此結束。我想將會議轉回瑞安·米爾斯（Ryan Mills）發表閉幕詞。

Thank you for joining today's call, and please reach out with any questions or follow-up requests. Our fiscal fourth-quarter earnings call is scheduled for Thursday, October 24, and we look forward to seeing you on the road and at conferences in the coming months. Goodbye.

感謝您參加今天的電話會議，如有任何問題或後續請求，請與我們聯絡。我們的第四財季財報電話會議定於 10 月 24 日星期四舉行，我們期待在未來幾個月的路上和會議上見到您。再見。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Thank you.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。謝謝。