RBC Bearings Inc (RBC) 2023 Q4 法說會逐字稿

[Welcome to] the RBC Bearings Fourth Quarter 2023 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded.

[歡迎參加]RBC 軸承 2023 年第四季度收益電話會議。 （操作員指示）謹此提醒，本次會議正在錄製中。

I would now like to turn the conference over to your host, Josh Carroll, with Investor Relations. Please go ahead.

現在我想將會議轉交給主持人喬什·卡羅爾（Josh Carroll）和投資者關係部。請繼續。

Thank you, operator. Good morning, and thank you for joining us for RBC Bearings Fiscal 2023 Fourth Quarter Earnings Conference Call. With me on the call today are Dr. Michael Hartnett, Chairman, President and Chief Executive Officer; Daniel Bergeron, Director, Vice President and Chief Operating Officer; and Robert Sullivan, Vice President and Chief Financial Officer.

謝謝你，接線員。早上好，感謝您參加 RBC 軸承 2023 財年第四季度收益電話會議。今天與我一起參加電話會議的是董事長、總裁兼首席執行官 Michael Hartnett 博士； Daniel Bergeron，董事、副總裁兼首席運營官；副總裁兼首席財務官羅伯特·沙利文。

Before beginning today's call, let me remind you that some of the statements made today will be forward-looking and are made under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected or implied due to a variety of factors.

在開始今天的電話會議之前，請允許我提醒您，今天所做的一些陳述將具有前瞻性，並且是根據 1995 年《私人證券訴訟改革法案》做出的。由於多種因素，實際結果可能與預測或暗示的結果存在重大差異。

We refer you to RBC Bearings' recent filings with the SEC for a more detailed discussion of the risks that could impact the company's future operating results and financial condition. These factors are also described in greater detail in the press release and on the company's website. In addition, reconciliation between GAAP and non-GAAP financial information is included as part of the release and is available on the company's website.

我們建議您參閱 RBC Bearings 最近向 SEC 提交的文件，以更詳細地討論可能影響該公司未來經營業績和財務狀況的風險。新聞稿和公司網站上也對這些因素進行了更詳細的描述。此外，GAAP 和非 GAAP 財務信息之間的調節也包含在新聞稿中，並可在公司網站上查看。

With that, I'll now turn the call over to Dr. Hartnett.

現在，我將把電話轉給哈內特博士。

Thank you, Josh, and good morning, and welcome to all. Net sales for the fourth quarter of fiscal 2023 were $394.4 million versus $358.9 million for the same period last year, an increase of 9.9%. For the fourth quarter of our 2023, sales of industrial products represented 69% of our net sales; and aerospace products, 31%. Gross margin for the quarter was $166.5 million or 42.2% of net sales. This compares with $137.5 million or 38.3% for the same period last year.

謝謝你，喬什，早上好，歡迎大家。 2023 財年第四季度的淨銷售額為 3.944 億美元，而去年同期為 3.589 億美元，增長 9.9%。 2023 年第四季度，工業產品銷售額占淨銷售額的 69%；和航空航天產品，31%。該季度毛利率為 1.665 億美元，占淨銷售額的 42.2%。相比之下，去年同期為 1.375 億美元，增幅為 38.3%。

Adjusted operating income was $88.6 million, 22.5% of net sales compared to last year's $71.9 million and 20%, respectively. Adjusted EPS came in at $2.13 a share. Adjusted EBITDA was $121.1 million, 30.7% of net sales compared to $104.4 million and 29.1% of net sales for the last -- same period last year.

調整後營業收入為 8860 萬美元，占淨銷售額的 22.5%，而去年分別為 7190 萬美元和 20%。調整後每股收益為 2.13 美元。調整後 EBITDA 為 1.211 億美元，占淨銷售額的 30.7%，而去年同期為 1.044 億美元，占淨銷售額的 29.1%。

On the Industrial businesses, during the period, the industrial sales growth was 7.4% against some strong comps from last year. Dodge was our leader with 9.2% expansion rate on combined OEM and distribution sales. The latter showed a low teens expansion rate for Dodge. Overall, the industrials were up high single digits, with sector growth mitigated somewhat by Europe.

在工業業務方面，在此期間，工業銷售增長了 7.4%，與去年的一些強勁比較相比。道奇是我們的領先者，其 OEM 和分銷銷售綜合增長率為 9.2%。道奇的後者顯示出較低的青少年擴張率。總體而言，工業增長了高個位數，但歐洲的影響在一定程度上減緩了該行業的增長。

On aerospace and defense, overall, we saw a rate of expansion of 16% with aero OEM up 25% and aero commercial distribution up 42.8%. The demand drivers here continue to be the large plane builders and their supply chain in support of production for Boeing and Airbus 737, 787, A320 and A330, principally, as well as other producers of business jets and a myriad of subcontractors needed to support the industry. Additional volume increases were felt from our space initiatives, and we saw demand for products to support the new field of air taxis beginning to trickle in.

在航空航天和國防領域，總體而言，我們看到了 16% 的擴張，其中航空 OEM 增長了 25%，航空商業分銷增長了 42.8%。這裡的需求驅動因素仍然是大型飛機製造商及其支持波音和空客 737、787、A320 和 A330 生產的供應鏈，以及其他公務機生產商和支持飛機製造所需的無數分包商。行業。我們的太空計劃帶來了額外的銷量增長，我們看到對支持空中出租車新領域的產品的需求開始逐漸增加。

As mentioned in previous calls, we expect to see increased demand, creating double-digit growth from the plane builders for many quarters to come as they continue to aggressively expand build rates. We continue to add resources and planning to support these increased rates as well as we expect expanded work statements.

正如之前的電話會議中提到的，我們預計需求將會增加，隨著飛機製造商繼續積極擴大建造率，他們將在未來許多季度實現兩位數的增長。我們將繼續增加資源和計劃來支持這些增加的費率，並期望擴大工作報表。

To summarize, for the period, RBC saw a growth in revenue of 9.9% and an adjusted EBITDA expansion of 16% against the same quarter last year. Regarding our first quarter of 2024. We are expecting sales to be somewhere between $380 million and $390 million range.

總而言之，與去年同期相比，加拿大皇家銀行 (RBC) 在此期間的收入增長了 9.9%，調整後的 EBITDA 增長了 16%。關於 2024 年第一季度。我們預計銷售額將在 3.8 億美元至 3.9 億美元之間。

And I'll now turn the call over to Rob for more detail on the financial performance.

現在我將把電話轉給 Rob，了解有關財務業績的更多詳細信息。

Thank you, Mike. SG&A for the fourth quarter of fiscal 2023 was $59.6 million compared to $54.5 million for the same period last year. As a percentage of net sales, SG&A was 15.1% for the fourth quarter compared to 15.2% for the same period last year. Looking forward, SG&A as a percentage of net sales is expected to be between 15.75% and 16% of sales in the first quarter, including approximately $3 million to $4 million of stock-based compensation expense.

謝謝你，邁克。 2023 財年第四季度的銷售、管理及行政費用 (SG&A) 為 5,960 萬美元，去年同期為 5,450 萬美元。第四季度銷售、管理及行政費用占淨銷售額的百分比為 15.1%，而去年同期為 15.2%。展望未來，SG&A 占淨銷售額的百分比預計將在第一季度銷售額的 15.75% 至 16% 之間，其中包括約 300 萬至 400 萬美元的股票薪酬費用。

Other operating expenses for the fourth quarter of fiscal 2023 totaled $20.7 million compared to $23.7 million for the same period last year. For the fourth quarter of fiscal '23, other operating expenses included $17.7 million of amortization of intangible assets, $2.5 million of restructuring costs associated with our South Carolina operations and $0.5 million of other items. For the fourth quarter of fiscal 2022, other operating expenses consisted primarily of $17.2 million of amortization of intangible assets, $5.7 million of costs associated with the Dodge acquisition and $0.8 million of other items.

2023 財年第四季度的其他運營支出總計 2070 萬美元，而去年同期為 2370 萬美元。 23 財年第四季度，其他運營支出包括 1770 萬美元的無形資產攤銷、250 萬美元與南卡羅來納州業務相關的重組成本以及 50 萬美元的其他項目。 2022 財年第四季度，其他運營支出主要包括 1720 萬美元的無形資產攤銷、570 萬美元的與道奇收購相關的成本以及 80 萬美元的其他項目。

Operating income was $86.1 million for the fourth quarter of fiscal '23 compared to operating income of $59.3 million for the same period in fiscal 2022, excluding approximately $2.6 million of restructuring costs associated with our South Carolina operations, offset by $0.1 million of acquisition-related costs. Adjusted operating adjustments -- adjusted operating income was $88.6 million or 22.5% of sales for the fourth quarter of fiscal 2023. Excluding approximately $12.5 million of acquisition costs, adjusted operating income for the fourth quarter of fiscal 2022 was $71.9 million or 20% of sales.

23 財年第四季度的營業收入為 8610 萬美元，而 2022 財年同期的營業收入為 5930 萬美元，不包括與南卡羅來納州業務相關的約 260 萬美元的重組成本，被收購相關的 10 萬美元所抵消成本。調整後的運營調整——調整後的運營收入為 8860 萬美元，佔 2023 財年第四季度銷售額的 22.5%。不包括約 1250 萬美元的購置成本，調整後的 2022 財年第四季度運營收入為 7190 萬美元，佔銷售額的 20% 。

Interest expense for the fourth quarter of fiscal 2023 was $21.7 million compared to $13.6 million for the same period last year. We anticipate interest expense between $20 million and $21 million for the first quarter of fiscal 2024, including approximately $1 million of costs associated with the amortization of deferred financing fees.

2023 財年第四季度的利息支出為 2170 萬美元，而去年同期為 1360 萬美元。我們預計 2024 財年第一季度的利息支出將在 2000 萬美元至 2100 萬美元之間，其中包括與遞延融資費用攤銷相關的約 100 萬美元成本。

For the fourth quarter of fiscal 2023, the company reported net income of $49.2 million compared to $31.5 million for the same period last year. On an adjusted basis, net income was $67.7 million for the fourth quarter of fiscal 2023 compared to $61.7 million for the same period last year.

2023 財年第四季度，該公司淨利潤為 4920 萬美元，而去年同期為 3150 萬美元。調整後的2023財年第四季度淨利潤為6770萬美元，而去年同期為6170萬美元。

Net income available to common stockholders for the fourth quarter of fiscal 2023 was $43.4 million compared to $25.7 million for the same period last year. On an adjusted basis, net income available to common stockholders for the fourth quarter of fiscal '23 was $61.9 million compared to $56 million for the same period last year.

2023 財年第四季度普通股股東可獲得的淨利潤為 4340 萬美元，而去年同期為 2570 萬美元。調整後，23財年第四季度普通股股東可獲得的淨利潤為6190萬美元，而去年同期為5600萬美元。

Diluted earnings per share attributable to common stockholders was $1.49 per share for the fourth quarter of fiscal '23 compared to $0.89 per share for the same period last year. On an adjusted basis, diluted earnings per share attributable to common stockholders for the fourth quarter of fiscal '23 was $2.13 per share compared to $1.93 per share for the same period last year.

2023財年第四季度稀釋後歸屬於普通股股東的每股收益為每股1.49美元，而去年同期為每股0.89美元。調整後，23財年第四季度普通股股東攤薄每股收益為每股2.13美元，而去年同期為每股1.93美元。

Turning to cash flow. The company generated $71.4 million in cash from operating activities in the fourth quarter of fiscal '23 compared to $46.9 million for the same period last year. Capital expenditures were $12.4 million in the fourth quarter of fiscal '23 compared to $8 million of capital expenditures for the same period last year.

轉向現金流。該公司在 23 財年第四季度的經營活動中產生了 7140 萬美元的現金，而去年同期為 4690 萬美元。 23 財年第四季度的資本支出為 1,240 萬美元，而去年同期的資本支出為 800 萬美元。

We paid down $70 million on the term loan during the period, leaving total debt of $1.4 billion as of April 1, 2023, and cash on hand was $65.4 million. Cumulatively, since November 2021, we've now paid $400 million on the term loan.

在此期間，我們償還了 7000 萬美元的定期貸款，截至 2023 年 4 月 1 日，債務總額為 14 億美元，手頭現金為 6540 萬美元。自 2021 年 11 月以來，我們已累計支付 4 億美元的定期貸款。

I would now like to turn the call back to the operator for the question-and-answer session.

我現在想將電話轉回給接線員進行問答環節。

(Operator Instructions) Our first questions come from the line of Kristine Liwag with Morgan Stanley.

（操作員說明）我們的第一個問題來自摩根士丹利的克里斯汀·利瓦格（Kristine Liwag）。

Looking at margins, I mean, you guys printed 42.2%. This is one of the highest you've ever had, if not the highest. Can you talk about what drove this margin improvement? How much of this is from synergies? And last quarter, you were already at the -- you already had significant synergies from Dodge. How much is left to get to your final target of $70 million to $100 million per year by year 5?

看看利潤率，我的意思是，你們打印了 42.2%。這即使不是最高的，也是您所經歷過的最高的之一。您能談談是什麼推動了利潤率的提高嗎？其中有多少來自協同效應？上個季度，您已經從道奇獲得了顯著的協同效應。距離第 5 年實現每年 7000 萬至 1 億美元的最終目標還剩多少錢？

Kristine, it's Dan. We had a good mix in the quarter. And you're right on the synergy side. Since owning Dodge over this period of time, we've added 7 percentage points to their gross margin contribution. And I think on the COGS side, that will start to slow for -- a little for the next 12 months, then pick up again at some of our longer-term projects that we're working on the synergy side will kick in.

克里斯汀，是丹。我們在本季度的表現很好。你就站在協同方面。自從收購道奇以來，我們在這段時間內為他們的毛利率貢獻增加了 7 個百分點。我認為，在 COGS 方面，未來 12 個月內，這將開始放緩一點，然後我們正在協同方面開展的一些長期項目再次加速。

On the top line sales side, I think we're a little behind target of where we'd like to be on our synergies. So I think we still have some good upside over the next 3 to 4 years to get to that target as we train our sales teams on both sides of RBC and Dodge to cross-sell each other's products around the world. And that's working well, but it takes time to get everybody trained up.

在營收方面，我認為我們的協同效應有點落後於目標。因此，我認為在未來 3 到 4 年內，我們仍有一些良好的優勢來實現這一目標，因為我們將培訓 RBC 和道奇雙方的銷售團隊，以便在全球範圍內交叉銷售彼此的產品。這很有效，但需要時間讓每個人都接受培訓。

And on SG&A, I think we're definitely ahead of where we thought we were going to be. We were able to move Dodge off of ABB's IT systems and picked up my savings on doing that. I'm getting them on to their own system and on the back of RBC's IT group also. And so we picked up some nice synergy there.

在SG&A 方面，我認為我們絕對領先於我們的預期。我們能夠將 Dodge 從 ABB 的 IT 系統中移除，並節省了我的積蓄。我讓他們使用自己的系統，並得到 RBC IT 團隊的支持。所以我們在那裡獲得了一些很好的協同作用。

So going into this year, Rob gave you guidance for Q1. Hopefully, we can do a little better than that. We'll see what happens. But I think we are definitely ahead of where we thought we would be coming into the real first year of our integration with Dodge.

因此，進入今年，Rob 為您提供了第一季度的指導。希望我們能做得更好一點。我們會看看會發生什麼。但我認為我們絕對領先於我們預期的與道奇整合的真正第一年。

Okay. And then following up on just the what -- how much synergies have already been harvested? Like from the $70 million to $100 million, can you just give us a run rate of how much of that has already been done?

好的。然後跟進什麼——已經收穫了多少協同效應？比如從 7000 萬美元到 1 億美元，您能否告訴我們其中已經完成了多少？

Yes, I'd say on average, that run rate is anywhere from $45 million to $56 million.

是的，我想說的是，平均運行費用在 4500 萬美元到 5600 萬美元之間。

Great. And then in terms of commercial aerospace, you talked about the significant step-up for aircraft production rates, Mike. And so can you level set us in terms of where you are in production rates going -- trying to hold on to 31 per month for the max? And there's discussion of moving up to 38 per month around now-ish to summer and then to 42 by year-end? Is that where you're tracking? Are you above or below where they are? Is there some sort of inventory that needs to get depleted before you get on that rate ramp? And also, any color you could provide on the 787 as well as you get towards 10, the A320 and the A350?

偉大的。然後，在商業航空航天方面，您談到了飛機生產率的顯著提高，邁克。那麼，您能否告訴我們您的生產率進展情況——盡量保持每月 31 件？有人討論從現在到夏天，每月增加到 38 次，然後到年底增加到 42 次？那是你追踪的地方嗎？你是在他們的上方還是下方？在您達到該速度之前，是否需要耗盡某種庫存？另外，您可以在 787 以及 10、A320 和 A350 上提供任何顏色嗎？

Yes. First, let's -- those are a lot of answers. Let's see. In terms of Boeing's content and where we are relative to the buildup, what we do is we look, as you do at their skyline chart and determine are they -- first of all, are they producing themselves to their chart, and we think they are. We kind of monitor that pretty closely.

是的。首先，我們有很多答案。讓我們來看看。就波音公司的內容以及我們相對於建設的位置而言，我們所做的就是觀察，就像你在他們的天際線圖上所做的那樣，並確定他們是否 - 首先，他們是否按照他們的圖表生產自己，我們認為他們是。我們對此進行了非常密切的監控。

And then we look at based upon if they're going to go to, say, 38 planes a year or whatever, and they're going to do it in January. We know that we have to have our product 6 months ahead of time, because if they're going to build 38 planes, the bearings can't show up and the hardware can't show up the day that they want 38 planes to exit their plant. So we kind of offset set the lead time on their chart by 6 months and determine what our production requirements are in order to have that product available in 6 months.

然後我們會考慮他們是否打算每年乘坐 38 架飛機或其他什麼，他們將在一月份這樣做。我們知道我們必須提前 6 個月提供產品，因為如果他們要製造 38 架飛機，那麼在他們希望 38 架飛機退出的那一天，軸承就無法出現，硬件也無法出現。他們的工廠。因此，我們將他們圖表上的交貨時間設置為 6 個月，並確定我們的生產要求，以便在 6 個月內提供該產品。

So we're pretty much aligned. We know what our mix per plane is. And as a result of knowing what that mix per plane is, we can kind of back calculate their rate and our rate and are they -- do they correlate? And they correlate very well. We've done a lot of work to make sure that we're completely in cadence with their buildup.

所以我們幾乎是一致的。我們知道每架飛機的組合是什麼。由於了解了每架飛機的混合情況，我們可以反算出他們的比率和我們的比率，它們是否相關？而且它們的相關性非常好。我們做了很多工作來確保我們完全跟上他們的節奏。

Now in terms of inventory in the system, right now, I would say, thank god, there's inventory in the system. Because stepping up production rates 25% a year is a big order for a company like us who actually have to make it from raw material to finished goods. So we're doing the best we can to meet their rate expectation. And we know by the end of the year, that whatever inventory is in the system for the 37 and the 87 is going to be pretty much squeezed out of the system. So we're going to be commando by about December. And so we're going to have to produce very well at their production rates, December and beyond.

現在就係統中的庫存而言，現在，我會說，謝天謝地，系統中有庫存。因為對於我們這樣的公司來說，每年提高 25% 的生產率是一個大訂單，因為我們實際上必須從原材料到成品。因此，我們正在盡最大努力滿足他們的費率期望。我們知道，到今年年底，系統中 37 和 87 的庫存幾乎都會被擠出系統。所以我們將在十二月左右成為突擊隊。因此，我們必須在 12 月及以後按照他們的生產率生產出色的產品。

And the difficulty in doing that is material. Lead time for these aircraft steels are 50 weeks and the deliveries after 50 weeks are not completely certain. So maybe you expect to get it in 50 weeks and you get it in 55 weeks or something like that.

而做到這一點的難度是巨大的。這些飛機用鋼的交貨期為 50 週，50 週後的交貨情況尚不完全確定。所以也許你期望在 50 週內得到它，而你卻在 55 週或類似的時間內得到它。

So steel availability is a problem and there's some steels that are not available at all. And they're important alloys and they're highly used in the aircraft industry. And I think the aircraft people are going to have some difficulty all the way around, not only in bearings, but in structures too, to determine how to substitute other steels for the steels that have already been specified for use.

因此，鋼材的供應是一個問題，有些鋼材根本就買不到。它們是重要的合金，在飛機工業中得到廣泛使用。我認為飛機製造商在確定如何用其他鋼材替代已指定使用的鋼材時會遇到一些困難，不僅在軸承方面，而且在結構方面。

And so Mike, in terms of these deals, is there a Boeing master agreement or an Airbus master agreement that could help with sourcing? I mean that seems like a fairly important input to have uncertainty over considering the production rate volumes that are in that skyline.

那麼邁克，就這些交易而言，是否有波音主協議或空客主協議可以幫助採購？我的意思是，這似乎是一個相當重要的輸入，因為在考慮天際線的生產率時存在不確定性。

Yes. We talk to them all the time. I'm sure other people have the same discussions, not just people making what we make. And these specialty steel producers are, to some extent, unwilling to produce the chemistry needed. Some of them have gone bankrupt or have been restructured. Actually, Airbus just bought one of them and -- because of this situation. And this situation exists in the United States, too. So I think it's something that -- what's that?

是的。我們一直和他們交談。我確信其他人也會有同樣的討論，而不僅僅是製作我們產品的人。在某種程度上，這些特種鋼生產商不願意生產所需的化學品。其中一些已經破產或已經重組。事實上，空中客車公司剛剛購買了其中一架——因為這種情況。而這種情況在美國也存在。所以我認為這是——那是什麼？

Sorry, Mike. So with this uncertainty, how are we going to see the 50%, 60% volume increases that the OEMs want in 2, 3 years? I mean the environment you're describing seems fairly dire for a really important input, and we've got this massive volume ahead of us to meet those rate ramps. How do you think this gets resolved? And does that put at risk these production rate increases?

對不起，邁克。那麼，在這種不確定性的情況下，我們如何才能看到 OEM 廠商希望在 2、3 年內實現 50%、60% 的銷量增長？我的意思是，你所描述的環境對於一個非常重要的輸入來說似乎相當可怕，而我們面前有如此巨大的數量來滿足這些速率提升。您認為這個問題如何解決？這是否會給生產率的提高帶來風險？

It certainly is a big consideration on these production rate increases, and it needs to be resolved and exactly how it gets resolved is there needs to be some material substitutions for some of these alloys in the design. And so -- and we can't do that. That's Boeing's design. So they're going to have to double time their engineering department to provide materials that are modern and available.

這當然是生產率提高的一個重要考慮因素，需要解決，而具體解決方法是在設計中需要對其中一些合金進行一些材料替代。所以——我們不能這樣做。這就是波音公司的設計。因此，他們將不得不加倍投入工程部門的時間來提供現代且可用的材料。

Our next questions come from the line of Pete Skibitski with Alembic Global.

我們的下一個問題來自 Alembic Global 的 Pete Skibitski。

Mike, just one clarification. When you talk about steel and steel alloys, are you also including sort of aluminum alloys and nickel alloys? Or is it strictly steel in these alloys?

邁克，請澄清一件事。當您談論鋼和鋼合金時，是否還包括鋁合金和鎳合金？或者這些合金中的鋼是嚴格意義上的鋼？

Well, I mean, it's steel and its alloys. And it's alloys are nickel and chrome and manganese and that sort of thing. But it's -- yes, that's -- I'm talking about steel. We don't have the aluminum worry that other people have, but we do have the steel worry.

嗯，我的意思是，它是鋼及其合金。它的合金有鎳、鉻、錳之類的。但它是——是的，那就是——我說的是鋼鐵。我們不像其他人那樣擔心鋁的問題，但我們確實擔心鋼的問題。

Okay. Okay. Got it. And I guess I just wanted to ask about the top line in the fourth quarter. You guys beat your own revenue guide pretty handily. Was there a particular market segment that surprised you there or a share gain maybe or something else?

好的。好的。知道了。我想我只是想問一下第四季度的營收情況。你們輕鬆地擊敗了自己的收入指南。是否有某個特定的細分市場讓您感到驚訝，或者可能是份額增長還是其他原因？

Well, I think -- as I said in the last conference call, it's really hard for us to project Dodge's revenue because of -- they really don't work with an order book like the rest of RBC does. So RBC has a backlog of a year in order book. So we're very -- we're very confident in our outlook for what we're going to produce and what it's going to generate for revenues.

嗯，我認為 - 正如我在上次電話會議中所說，我們真的很難預測道奇的收入，因為 - 他們確實不像加拿大皇家銀行的其他公司那樣使用訂單簿。因此，RBC 的訂單積壓了一年。因此，我們對我們將要生產的產品以及將產生的收入的前景非常有信心。

With Dodge, they have a much different business model where they're sort of GDP-driven. I mean you tell me what the GDP is going to be and I'll tell you what Dodge's revenues are going to be. So in this particular quarter, their business was stronger than we had anticipated when we did our last conference call, and it continues to be strong.

對於道奇來說，他們有一個非常不同的商業模式，他們是 GDP 驅動的。我的意思是，你告訴我 GDP 是多少，我會告訴你道奇的收入是多少。因此，在這個特定的季度，他們的業務比我們上次電話會議時的預期要強勁，並且持續強勁。

Okay. That's fair. And to that point, I mean, you've seen ISM PMIs below 50 now for a couple of quarters in a row, right? So I'm wondering, are you guys kind of seeing out there market softness at all? Or -- I'm wondering if there's market softness, but you're kind of offsetting it with pricing gains and market share gains, things like that, or actually are just the end market just stronger than you might expect for where the PMIs are right now? And you talked about Europe being weak as well.

好的。這還算公平。我的意思是，到目前為止，ISM PMI 已連續幾個季度低於 50，對吧？所以我想知道，你們看到市場疲軟了嗎？或者——我想知道市場是否疲軟，但你可以通過定價收益和市場份額收益等來抵消它，或者實際上只是終端市場比你對 PMI 的預期更強現在？你也談到了歐洲的疲軟。

Yes. Well, I mean, in the industrial business, it's very end market-dependent, right? And right now, there's a lot of consolidation going on in these -- with these industrials that are our peers. And so I'm sure that's creating some service level problems.

是的。嗯，我的意思是，在工業業務中，它非常依賴終端市場，對吧？現在，這些行業正在與我們的同行進行大量整合。所以我確信這會造成一些服務水平問題。

But on the other hand, there's the end -- very end market-dependent. And our end markets are -- if you start with oil and gas, it's very strong. Semicon is soft, but it's not dead. Mining is steady and the demand is very acceptable. Aggregate is very good. Grain is very good. Infrastructure is good. Wind is not as breezy as it was last year. General distribution is very good. And it's -- these industrial markets are surprisingly strong that we serve despite the news of the day and what the economy is doing.

但另一方面，最終結果是非常依賴於終端市場的。我們的終端市場是——如果從石油和天然氣開始，它非常強大。半導體很軟，但它還沒有消亡。採礦穩定，需求非常可以接受。綜合性非常好。穀物非常好。基礎設施良好。風不像去年那麼大了。總體分佈非常好。儘管當天的新聞和經濟狀況如何，我們所服務的這些工業市場卻出人意料地強勁。

Yes, yes. Okay. Last one for me, and I appreciate the color. You guys have been talking a lot -- you expect to grow this year, but you've also been talking about additional defense plans. You did just do a restructuring in South Carolina. I don't know if that was just a pure kind of cost takeout or not. But how does kind of all that roll up into your CapEx projection for fiscal '24?

是的是的。好的。最後一張對我來說，我很欣賞它的顏色。你們已經談了很多——你們預計今年會增長，但你們也一直在談論額外的防禦計劃。你們剛剛在南卡羅來納州進行了重組。我不知道這是否只是一種純粹的成本外賣。但是，所有這些如何匯總到您對 24 財年的資本支出預測中呢？

Yes. I think we'll be right in that 3%, 3.5% of revenue range. I'd be surprised if it bulges more than that. There's nothing to make a bulge right now on the horizon.

是的。我認為我們將在收入的 3%、3.5% 範圍內。如果它凸出得更多，我會感到驚訝。現在沒有什麼可以讓地平線上凸出。

Okay. Okay. And the South Carolina restructuring, was that just a pure cost reduction at Dodge? Is that how to think about that?

好的。好的。南卡羅來納州的重組是否只是道奇純粹的成本削減？是這樣想的嗎？

Yes. It was kind of a combination of some cleanup at the Dodge level as well as one of our legacy RBC plants just clean up down there. So nothing out of the ordinary.

是的。這是道奇級別的一些清理工作以及我們遺留的 RBC 工廠之一在那裡進行的清理工作的結合。所以沒什麼不尋常的。

Our next questions come from the line of Steve Barger with KeyBanc Capital Markets.

我們的下一個問題來自 KeyBanc Capital Markets 的 Steve Barger。

Thinking about your 1Q revenue guide. As I look at the comps, it seems like we'll see another double-digit organic for aero, maybe single digit for industrial. So first, is that how you see it? And second, is that how you're thinking about the year as well?

思考您的第一季度收入指南。當我查看比較時，我們似乎會看到航空領域的另一個兩位數的有機增長，工業領域的可能是個位數。首先，你是這麼看的嗎？其次，你也是這樣看待這一年的嗎？

Yes and yes.

是的，是的。

Got it.

知道了。

Yes, and absolutely, yes.

是的，絕對是的。

Absolutely, yes, single-digit industrial? Or just that's -- that you expect solid growth for the full year?

絕對，是的，單位數工業？或者只是——您預計全年將實現穩健增長？

Yes. I mean it will be single-digit industrial, I expect, maybe a little bit better. Certainly not into the double digits, maybe the upper singles. And the aerospace will be strong. It will be sort of at least mid-teens. And marine, marine will be a contributor, and they haven't been this past year, but the knots are getting untied and that material will start to flow.

是的。我的意思是，我預計工業將是個位數，也許會好一點。當然不會進入兩位數，也許是上單打。航空航天將變得強大。至少會有十幾歲左右。海洋、海洋將成為貢獻者，去年他們還沒有這樣做，但結正在解開，材料將開始流動。

That sounds good. So with that in mind, you drove 174 basis points of gross margin expansion last year, which was the best performance in 10 years. You talked about -- or Dan talked about the Dodge COGS benefit starting to slow this year. Can you talk through total company gross margin expansion plans that you see? What's your target? What are the big levers for expansion? Just how are you thinking about gross margin for FY '24?

聽起來很好。因此，考慮到這一點，去年毛利率增長了 174 個基點，這是 10 年來最好的表現。你談到——或者丹談到道奇的銷貨成本效益今年開始放緩。您能談談您所看到的公司總毛利率擴張計劃嗎？你的目標是什麼？擴張的重要槓桿是什麼？您對 24 財年的毛利率有何看法？

Well, I'd love to say that we're going to grow 0.5 points to 1 point. I can't tell you what the details of that growth are going to be. That's probably more an objective than a plan. But I don't see we're going to see -- see we're going to have any deterioration in gross margin.

嗯，我很想說我們將增長 0.5 點到 1 點。我無法告訴你增長的細節是什麼。這可能更像是一個目標而不是計劃。但我認為我們不會看到毛利率出現任何惡化。

I mean just the volume alone should give you pretty good leverage, right? What's the offset?

我的意思是，僅憑交易量就應該給你帶來很好的槓桿作用，對吧？偏移量是多少？

Yes, just the aircraft volume going through the plants, which is -- we're seeing quarter-to-quarter, better absorption of our overheads, because we've had some of those plants on a slow cadence. And so that's -- that by itself is going to accrue to the benefit.

是的，只是通過工廠的飛機數量，我們看到每季度都更好地吸收了管理費用，因為我們其中一些工廠的節奏很慢。所以這本身就會帶來好處。

On the other hand, we -- the Dodge business is heavily dependent upon subcontractors and purchase parts. And those variances have -- we're crazy last year, and they're under control this year. They seem to be normalizing. On the other hand, counter to that, we're working to in-source some of that product from Asia to the United States and into Mexico, into our Mexico plants. So still there will be some start-up expenses on based on learning curve that we'll probably have to absorb, but it's absorbable.

另一方面，我們——道奇業務嚴重依賴分包商和採購零件。這些差異去年我們很瘋狂，但今年它們已得到控制。他們似乎正在正常化。另一方面，與此相反，我們正在努力將部分產品從亞洲採購到美國和墨西哥，進入我們的墨西哥工廠。因此，根據學習曲線，我們可能必須吸收一些啟動費用，但它是可以吸收的。

And over the longer term, we'll get better absorption in the Mexico plants just by doing that. So yes, I think, overall, there should be some expansion. I wouldn't say that we're going to see the same year that we saw last year.

從長遠來看，通過這樣做，我們將在墨西哥工廠獲得更好的吸收。所以，是的，我認為，總的來說，應該有一些擴展。我不會說我們會看到去年的情況。

Yes. Understood. Going back to Pete's question about PMI being sub-50 for 6 or 7 months now, but really strong industrials, not just from you, that's what we heard through earnings season in general. What are your thoughts on the divergence? Why -- you study cycles, what do you think is going on?

是的。明白了。回到皮特關於 PMI 已經連續 6 或 7 個月低於 50 的問題，但工業股確實強勁，而不僅僅是你，這就是我們在整個財報季聽到的總體情況。您對這種分歧有何看法？為什麼——你研究週期，你認為發生了什麼？

That's a good question. I study our sectors pretty well, and I kind of know what's going on there, but I don't know -- I mean, we're not into automotive and heavy truck and all that sort of thing in any major way. And so those markets are -- as you can see, haven't been robust, they've been acceptable. Consumer goods is not our thing. But what we do is produce the basic food stuffs in aggregate to keep the economy moving.

這是個好問題。我對我們的行業研究得很好，我知道那裡正在發生什麼，但我不知道 - 我的意思是，我們不以任何主要方式進入汽車和重型卡車以及所有此類事物。因此，正如您所看到的，這些市場並不強勁，但還可以接受。消費品不是我們的事。但我們所做的是總體生產基本食品以保持經濟發展。

And we're -- if you look at the Dodge business, it's a very low beta business in terms of -- in terms of its demand profile across the years. So I think we're a little bit -- I wouldn't say immune, but a little bit different than the normal industrial business that's servicing automotive and consumer products..

如果你看看道奇業務，就其多年來的需求狀況而言，這是一個貝塔係數非常低的業務。所以我認為我們有點——我不會說免疫，但與為汽車和消費品提供服務的正常工業企業有點不同。

Our next questions come from the line of Seth Weber with Wells Fargo.

我們的下一個問題來自富國銀行的賽斯·韋伯 (Seth Weber)。

This is Larry Stavitski on for Seth this morning. You guys mentioned the areas of strength, industrial strength in terms of end markets. Have you seen any change in industrial customer appetite due to macro concerns quarter-over-quarter? Anything that's of concern to you guys?

我是拉里·斯塔維茨基 (Larry Stavitski)，今天早上替賽斯 (Seth) 發言。你們提到了終端市場方面的優勢領域、產業優勢。您是否看到由於宏觀擔憂而導致工業客戶偏好出現季度環比變化？大家有什麼關心的嗎？

Well, we're thinking about that. No, I guess the overall answer is no, we haven't seen any concern. I think the only soft spot that we've seen in the industrial side was the reversal of Amazon's decision to build all those warehouses. So I think that kind of kicked the legs out of a few stools in the industry. And our business softened up last year at this time in that sector, but we've completely been able to overcome and restructure around it.

嗯，我們正在考慮這個。不，我想總體答案是否定的，我們沒有看到任何擔憂。我認為我們在工業方面看到的唯一弱點是亞馬遜改變了建造所有這些倉庫的決定。所以我認為這有點讓業內的一些人感到不安。去年這個時候我們在該領域的業務有所疲軟，但我們完全能夠克服它並圍繞它進行重組。

Okay. Okay. And then on supply chain, you mentioned steel availability is still a problem. How has the dynamics with supply chain, how have they changed quarter-to-quarter or year-over-year? I mean are things loosening up a little bit for you guys? Or is it still pretty tight out there?

好的。好的。然後在供應鏈方面，您提到鋼材供應仍然是一個問題。供應鏈的動態如何？季度與季度或同比有何變化？我的意思是，你們的情況是否有所放鬆？或者那裡仍然很緊張？

Well, it's pretty much normalized. For most steels for 80% of our steels, which are in production and -- the planning lead time has expanded. And so we just have to expand our planning lead time to accommodate it. So as long as you can get ahead of that game, you'll do fine. And we're ahead of the game. And on the specialty steels, those are still hard to get. I mean those are -- that's a problem that still needs to be solved.

嗯，這已經很正常化了。對於大多數鋼材，我們 80% 的鋼材已投入生產，並且計劃交付時間已延長。所以我們只需要延長我們的計劃準備時間來適應它。因此，只要你能在這場比賽中領先，你就會做得很好。我們處於領先地位。而對於特種鋼來說，這些仍然很難獲得。我的意思是，這是一個仍然需要解決的問題。

Yes. And you expect that to go on for a couple of quarters?

是的。您預計這種情況會持續幾個季度嗎？

I don't -- I think new suppliers have to be -- will be tooled. I mean I think there's got to be some new people entering this market that can produce these things. It's -- it's capital intense, but a lot of people already have this capital. And if they realize that there's decent volume and decent profitability in these alloys, I think the problem would get solved.

我不——我認為新的供應商必須——將被裝備。我的意思是，我認為一定有一些新人進入這個市場，可以生產這些東西。這是資本密集型的​​，但很多人已經擁有這種資本。如果他們意識到這些合金的產量和盈利能力都不錯，我認為問題就會得到解決。

Our next questions come from the line of Joe Ritchie with Goldman Sachs.

我們的下一個問題來自高盛的喬·里奇。

This is Vivek Srivastava on for Joe Ritchie. My first question is on industrial inventory at distributors. Could you provide some color on the destock risk, especially on the industrial distributor side? And maybe any color by end market where there's more destock risk right now versus less? And any color on the time line of when the destock can happen?

我是維韋克·斯里瓦斯塔瓦 (Vivek Srivastava)，替喬·里奇 (Joe Ritchie) 發言。我的第一個問題是關於分銷商的工業庫存。您能否提供一些有關去庫存風險的信息，尤其是工業分銷商方面的風險？也許終端市場目前存在更多去庫存風險而不是更少的顏色？什麼時候可以進行去庫存？

Yes. Well, yes, I think the industry at large is, as far as we could see, there hasn't been any overstocking situation. I think during the pandemic, it was hard to get the materials. And so now I think most of our distributors are happy to have -- have to be able -- happy to get -- able to get these materials and put them on their shelf. 50% of their sales is from break-fix, so when something is broken in the marketplace and somebody needs an immediate repair, and it's a profitable sale for them if they have it in inventory. So they don't like not to have it in inventory.

是的。嗯，是的，我認為，據我們所知，整個行業並沒有出現任何庫存過剩的情況。我覺得疫情期間，材料很難拿到。所以現在我認為我們的大多數經銷商很高興能夠獲得這些材料並將其放在貨架上。他們 50% 的銷售額來自故障修復，因此，當市場上的某樣東西出現故障並且有人需要立即維修時，如果他們有庫存，那麼這對他們來說是一筆有利可圖的銷售。所以他們不喜歡庫存中沒有它。

Now there's been some inventory liquidation over the past 6 to 9 months is a couple of our major customers consolidated. And during the consolidation, stores were closed and inventories were combined, and we definitely saw a drop in revenues from some major customers as this occurred. And that was probably -- it seemed to have been completed around the December, January time period, which may have been part of the reason why our fourth quarter was stronger than we had anticipated. But that's the only mechanism that we saw that was unusual in place over the last 12 months.

現在，我們的幾個主要客戶在過去 6 到 9 個月內進行了一些庫存清算。在整合期間，商店關閉，庫存合併，我們確實看到一些主要客戶的收入下降。這可能是——它似乎是在 12 月、1 月期間完成的，這可能是我們第四季度比我們預期強勁的部分原因。但這是我們在過去 12 個月中看到的唯一不尋常的機制。

Got it. That's super helpful. And then just maybe on your backlog. It looks like sequentially, backlogs were pretty strong and maybe it's driven by aero. Any indication you can provide on how the industrial side of the backlog on RBC is pending? And what are you seeing from order trends on the industrial side?

知道了。這非常有幫助。然後也許就在你的積壓工作中。從順序來看，積壓訂單相當多，也許是由航空動力驅動的。您能否提供有關 RBC 積壓工業方面的待處理情況的任何信息？您從工業方面的訂單趨勢中看到了什麼？

Yes, sure. Most of the sequential increase was driven from our defense business, be it Sargent or actually one of our legacy businesses. The Dodge backlog was actually down $10 million, which is not a bad thing because as we've talked about, they are not a business that traditionally carries a significant backlog. But the orders have remained strong, holistically in the industrial side of the business.

是的，當然。大部分連續增長是由我們的國防業務推動的，無論是薩金特還是我們的傳統業務之一。道奇積壓訂單實際上減少了​​ 1000 萬美元，這並不是一件壞事，因為正如我們所討論的，他們並不是傳統上擁有大量積壓訂單的企業。但總體而言，工業方面的訂單依然強勁。

That's helpful. My last one, just across like some of your peers talk about having portfolio outside of just bearings and broadly across the industrial drivetrain could help with gaining more traction with the customers. Just any indication on how much of your portfolio maybe is outside of bearings, more on the industrial drivetrain side? And like what is your counter to some of those claims that peers probably who have more products across the drivetrain can gain more share?

這很有幫助。我的最後一篇文章，就像您的一些同行談論的那樣，擁有軸承之外的產品組合以及廣泛的工業傳動系統可以幫助獲得更多客戶的青睞。能否說明您的產品組合中有多少是在軸承之外，更多的是在工業傳動系統方面？對於那些聲稱擁有更多傳動系統產品的同行可以獲得更多份額的說法，您有何反駁？

Yes. I would think that maybe 25% to 30% of our sales are products that are not bearings. They're either systems, gearbox systems or they're valves or they're rods that go into structural components for aircraft. So yes, I'd say we haven't made those calculations but -- so I'm extrapolating what I know about the business, but I'd say it's 25% to 30% of our revenues are outside the direct bearing line.

是的。我認為我們銷售額的 25% 到 30% 可能是非軸承產品。它們要么是系統、變速箱系統，要么是閥門，或者是飛機結構部件中的桿。所以，是的，我想說我們還沒有進行這些計算，但是——所以我根據我對業務的了解進行推斷，但我想說我們的收入中有 25% 到 30% 超出了直接承接線。

Our next questions come from the line of Michael Ciarmoli with Truist.

我們的下一個問題來自 Michael Ciarmoli 和 Truist 的對話。

Nice results and margins here. Maybe, Mike, just a lot of this talk on supply chain in aero. I mean as you look at the year, you said double-digit aero growth. I mean how do you risk-adjust that for not getting access to supply? I mean is there a -- is there a big threat there to meeting your objectives for the year? And I mean, I think we keep here in some cases, bearing lead times are stretching out like 3 years. But how do we just think about the risk of you guys executing if you don't get that supply?

這裡有不錯的結果和利潤。邁克，也許，關於航空供應鏈的討論很多。我的意思是，當你回顧這一年時，你說的是兩位數的航空增長。我的意思是，如果無法獲得供應，您如何進行風險調整？我的意思是，實現今年的目標是否存在很大的威脅？我的意思是，我認為在某些情況下我們會留在這裡，軸承交貨時間會延長大約 3 年。但是，如果你們得不到供應，我們如何考慮你們執行的風險呢？

Well, we do get the supply. It's -- more than 90% of our bearing products -- probably 95% of our bearing products use materials that are readily available. There is that other 5% of not only bearings but structural components that are more difficult to get. And I think it's a bigger problem for somebody like Boeing, who uses these materials widely across their aircraft line than it is for RBC.

好吧，我們確實得到了供應。我們 90% 以上的軸承產品——可能 95% 的軸承產品都使用現成的材料。還有另外 5% 的軸承和結構部件都更難獲得。我認為對於波音這樣的公司來說，這是一個比加拿大皇家銀行更大的問題，因為波音公司在其飛機生產線上廣泛使用了這些材料。

Okay. Okay. That helps. So you're -- okay. So if you're exposed, it's about 5% of your product and where you're seeing some of that tightness on alloys.

好的。好的。這有幫助。所以你——好吧。因此，如果您暴露在外，大約佔您產品的 5%，並且您會在合金上看到一些緊密度。

Yes, maximum 5%.

是的，最多 5%。

Okay. Okay. And then just back to the gross margins. I know you called out some of these learning curves and start-ups, but you got a little bit of, I guess, volume step down in the first quarter. But what else is driving the gross margins to step down? I know you guys were pretty enthusiastic a couple of quarters ago calling out a new floor, and now we're going to see -- I mean, still phenomenal margins. But is there anything else to read into? I mean is it just conservatism? And again, I know you called out some of the subcontractors purchasing parts, some of the moves. But is that kind of the driver? Or how should we think about that in the first quarter?

好的。好的。然後回到毛利率。我知道您提到了其中一些學習曲線和初創企業，但我猜您在第一季度的銷量有所下降。但還有什麼因素導致毛利率下降呢？我知道你們幾個季度前非常熱情地呼籲開設新樓層，現在我們將看到——我的意思是，仍然有驚人的利潤。但還有什麼可以讀的嗎？我的意思是這只是保守主義嗎？再說一次，我知道你召集了一些分包商購買零件，一些動作。但這樣的司機是這樣的嗎？或者說第一季度我們應該如何看待這個問題？

You mean for the revenue projections for the first quarter?

您是指第一季度的收入預測嗎？

The gross margin projection, 41% to 41.5% stepping down sequentially from what you just did this quarter.

毛利率預測將從本季度的 41% 下降到 41.5%。

Yes. Yes. Well, I think that's probably a little conservatism playing a role there. There's no supporting mathematics behind that estimate, believe me.

是的。是的。嗯，我認為這可能是有點保守主義在其中發揮了作用。相信我，這個估計背後沒有任何數學支持。

Okay. Okay. That's good to know. And what about -- you talked about the synergies. I think you talked about the COGS kind of slowing down. But I guess going back to when you made this Dodge deal, you did talk about, I guess, $200 million or so of material and supply you could source in-house. I mean is that -- where are we there? And I think you maybe said beyond the next 12 months, that kicks in. Can you give any color in terms of how much runway is left on that?

好的。好的。很高興知道這一點。您談到了協同效應。我想你談到了銷貨成本放緩。但我想，當你與道奇達成這筆交易時，你確實談到了，我想，你可以在內部採購價值 2 億美元左右的材料和供應。我的意思是——我們在哪裡？我想你可能會說，在接下來的 12 個月之後，這就會開始發揮作用。你能給出一些關於跑道還剩多少的信息嗎？

Yes, we're right at the beginning of that. I mean, that's -- we've only been doing this for a little bit over a year plus a quarter. So yes, we're right at the beginning of sort of looking at that mix, identifying what part of that mix could be best made in some of our lower-cost plants, what part of that mix needs to be made in order to support the volume demands that we see. And also, at the same time, as we got into that, we found a lot of areas of growth potential that could be achieved.

是的，我們正處於起步階段。我的意思是，我們這樣做只持續了一年多一個季度。所以，是的，我們正處於研究這種組合的開始，確定該組合的哪一部分最適合在我們的一些低成本工廠生產，需要生產該組合的哪一部分才能支持我們看到的體積要求。與此同時，當我們進入這個領域時，我們發現了許多可以實現的增長潛力領域。

If we made this product or we made that product or we in-sourced certain materials that our supply chain had always had problems producing, so if we in-source -- capitalize and in-source those materials, we could see upside to our revenues and our margins. And so it's sort of the outside the synergy concept. But clearly, there's plenty of upside in the Dodge product offering to take advantage of by incorporating some of these product strategies.

如果我們生產這個產品或我們生產那個產品，或者我們內購我們的供應鏈生產中一直存在問題的某些材料，所以如果我們內購——資本化和內購這些材料，我們可以看到我們收入的上升空間和我們的利潤。所以這有點超出了協同概念。但顯然，道奇產品有很多優勢可以通過整合其中一些產品策略來利用。

Okay. Okay. That's good to know. So then I mean, again, the margins have been fantastic here. But if we look at, I think, you kind of said, mid-30% EBITDA margin target by year 5, and certainly, it sounds like you've got runway and levers to pull starting with that COGS. I mean so you're still confident in that mid-30%, up there, EBITDA margin?

好的。好的。很高興知道這一點。所以我的意思是，這裡的利潤率非常好。但如果我們看看，我想，你說過，到第 5 年，EBITDA 利潤率目標將達到 30%，當然，聽起來你已經有了從 COGS 開始的跑道和槓桿。我的意思是，您仍然對 30% 左右的 EBITDA 利潤率充滿信心嗎？

That's a good goal. I mean you need to have a -- what do they say, a humongous goal? So I think we're making our way towards it, let's put it that way.

這是一個很好的目標。我的意思是你需要有一個——他們怎麼說，一個巨大的目標？所以我認為我們正在朝著這個目標前進，讓我們這樣說吧。

Okay. Fair. Last question, I'll get out of the way. I guess the implied defense, you didn't give the defense revenues, but I guess they look to be down 7%. I mean I know you talked about marine not being a contributor presumably lapping some easy comps, get some of that product flow in on the subs. So should we expect a pretty good rebound in defense next year or this year for fiscal '24?

好的。公平的。最後一個問題，我就讓開吧。我猜隱含的國防，你沒有給出國防收入，但我猜他們看起來下降了 7%。我的意思是，我知道你談到海洋不是一個貢獻者，大概是在一些簡單的比賽中，讓一些產品流進入潛艇。那麼，我們是否應該期待明年或今年 24 財年的國防業務出現相當好的反彈？

Yes. It -- probably, it comes in later in the year. Because first of all, I think the marine business gets its mojo going and it looks like it's on track for that. And at the same time, we have a lot of key product that has to be replaced. It was used in the Ukraine situation. And so that will probably start phasing in at the end of the year.

是的。它——可能會在今年晚些時候推出。因為首先，我認為海運業務正在發揮其魔力，而且看起來正在朝著這個方向發展。與此同時，我們還有很多關鍵產品需要更換。它被用於烏克蘭的情況。因此，這可能會在今年年底開始逐步實施。

Our next questions come from the line of Pete Skibitski with Alembic Global.

我們的下一個問題來自 Alembic Global 的 Pete Skibitski。

Just one follow-up for me, guys. I don't think all the data is out yet, but it looks like probably fiscal '23 ended up as a big inventory build year for you guys. And I imagine some of that is safety stock, maybe some is to support the growth. Just wondering if you expect inventory to build at a similar level in fiscal '24 than it did in '23.

伙計們，這只是我的一個後續行動。我認為所有數據還沒有出來，但看起來 23 財年對你們來說可能是一個大庫存建設年。我想其中一些是安全庫存，也許一些是為了支持增長。只是想知道您是否預計 24 財年的庫存量將達到與 23 財年相似的水平。

Pete, it's Rob. So inventory build for the year was about $70 million, a little more than $70 million. Some of that was at the Sargent business where, as we've talked about in the past, we do get reimbursed for some of that material purchase on the marine program. The rest of it was Dodge, primarily. And I don't expect that level of growth in the next fiscal year.

皮特，我是羅布。因此，今年的庫存建設約為 7000 萬美元，略高於 7000 萬美元。其中一些是在薩金特業務中，正如我們過去談到的那樣，我們確實獲得了海洋項目中部分材料採購的報銷。剩下的主要是道奇。我預計下一財年不會出現這樣的增長水平。

Okay. Okay. What drove the Dodge growth? Just curious.

好的。好的。是什麼推動了道奇的增長？只是好奇。

Supply chain. When you can't get it from supplier A, you order it from supplier B, and then supplier A delivers and supplier B delivers.

供應鏈。當你無法從供應商A處獲得時，你可以向供應商B訂購，然後供應商A發貨，供應商B發貨。

Ladies and gentlemen, there are no further questions at this time. I would now like to turn the call back over to Dr. Michael Hartnett for any closing remarks.

女士們、先生們，目前沒有其他問題了。我現在想將電話轉回給邁克爾·哈內特博士，請他發表結束語。

Okay. Well, that's the end of our conference call. We thank you for participating, and look forward to speaking to you again in the July-August time frame. Good day.

好的。好了，我們的電話會議到此結束。我們感謝您的參與，並期待在 7 月至 8 月期間再次與您交談。再會。

Thank you. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.

謝謝。今天的電話會議到此結束。我們感謝您的參與。此時您可以斷開線路。享受你一天剩下的時間。