Standard Motor Products Inc (SMP) 2023 Q3 法說會逐字稿

Good day, everyone, and welcome to the Standard Motor Products Third Quarter 2023 Earnings Call Webcast. (Operator Instructions) Please note, today's call will be recorded. It is now my pleasure to turn the conference over to Mr. Tony Cristello. Please go ahead, sir.

大家好，歡迎收看標準汽車產品公司 2023 年第三季財報電話網路廣播。 （操作員說明）請注意，今天的通話將會被錄音。現在我很高興將會議交給托尼·克里斯泰洛先生主持。請繼續，先生。

Thank you, Cory. Good morning, everyone, and thank you for joining us on Standard Motor Products Third Quarter 2023 Earnings Conference Call. I'm Tony Cristello, Vice President of Investor Relations. And with me today are Larry Sills, Chairman Emeritus; Eric Sills, CEO and Chairman; Jim Burke, Chief Operating Officer; and Nathan Iles, Chief Financial Officer.

謝謝你，科里。大家早安，感謝您參加標準馬達產品公司 2023 年第三季財報電話會議。我是托尼·克里斯泰洛，投資者關係副總裁。今天與我在一起的還有榮譽主席拉里·希爾斯 (Larry Sills)；希爾斯（Eric Sils），執行長兼董事長；吉姆·伯克，營運長；和財務長內森‧艾爾斯 (Nathan Iles)。

On our call today, Eric will give an overview of our performance in the quarter, and Nathan will then discuss our financial results with an update on our annual guidance. Eric will provide some concluding remarks and open the call up for Q&A.

在今天的電話會議上，埃里克將概述我們本季度的業績，然後內森將討論我們的財務業績以及年度指導的最新情況。埃里克將提供一些總結性評論並開始問答環節。

Before we begin this morning, I'd like to remind you that some of the material that we'll be discussing today may include forward-looking statements regarding our business and expected financial results. When we use words like anticipate, believe, estimate or expect, these are generally forward-looking statements.

在今天早上開始之前，我想提醒您，我們今天將討論的一些資料可能包括有關我們業務和預期財務業績的前瞻性陳述。當我們使用「預期」、「相信」、「估計」或「期望」等字眼時，這些通常是前瞻性陳述。

Although we believe that the expectations reflected in these forward-looking statements are reasonable, they are based on information currently available to us and certain assumptions made by us, and we cannot assure you that they will prove correct. You should also read our filings with the Securities and Exchange Commission for a discussion of the risks and uncertainties that could cause our actual results to differ from our forward-looking statements. I'll now turn the call over to Eric Sills, our CEO.

儘管我們認為這些前瞻性聲明中反映的預期是合理的，但它們是基於我們目前掌握的資訊和我們所做的某些假設，我們不能向您保證它們將被證明是正確的。您還應該閱讀我們向美國證券交易委員會提交的文件，以了解可能導致我們的實際結果與前瞻性陳述不同的風險和不確定性的討論。現在我將把電話轉給我們的執行長 Eric Sills。

Well, thank you, Tony, and good morning, everyone, and welcome to our third quarter earnings call. Overall, we're pleased with our results. Our sales were up slightly, setting a record for a single quarter, and we saw a nice increase in earnings even in the face of interest rate headwinds. Additionally, we continue to show strong cash flow improvement, allowing us to pay down about 1/3 of our outstanding debt.

好吧，謝謝托尼，大家早上好，歡迎參加我們的第三季財報電話會議。總的來說，我們對我們的結果感到滿意。我們的銷售額略有成長，創下了單季的記錄，即使面對利率逆風，我們的收益也出現了不錯的成長。此外，我們的現金流繼續強勁改善，使我們能夠償還約 1/3 的未償債務。

Let me address each segment (inaudible). I'll first speak to the aftermarket starting with vehicle control. Vehicle control was essentially flat year-to-date and down 3.4% in the quarter. This was against a record quarter a year ago, which posted nearly 6% growth, so it was a difficult comparison. There were also two other notable drivers. First, as mentioned in the release, we continue to see the impact of the customer bankruptcy announced earlier in the year. After a half year of potentially no revenue, the business was acquired a few months ago by a handful of existing SMP customers. We believe that in the long run, the business will bounce back to historic levels, but we recognize that this could take a while as they absorb the acquired locations and inventories, and therefore, we expect an ongoing drag on the business, which should diminish over time.

讓我談談每個部分（聽不清楚）。我先從車輛控制開始談售後市場。年初至今，車輛控制量基本持平，本季下降 3.4%。這與一年前創紀錄的季度增長近 6% 相比，因此很難進行比較。還有另外兩位著名的車手。首先，正如新聞稿中提到的，我們繼續看到今年稍早宣布的客戶破產的影響。在半年可能沒有收入後，幾個月前，該業務被少數現有的 SMP 客戶收購。我們相信，從長遠來看，業務將反彈至歷史水平，但我們認識到，這可能需要一段時間，因為他們吸收了收購的地點和庫存，因此，我們預計對業務的持續拖累應該會減少隨著時間的推移。

Secondly, the third quarter of 2022 saw a greater amount of pipeline orders than this year. These tend to flex quarter-to-quarter and year-to-year as customers adjust their planograms and can, therefore, create a bit of noise. Importantly, we always look at customer POS as an indicator of true end-user demand. And in aggregate, our large customers remained ahead of last year.

其次，2022年第三季的管道訂單量比今年更多。隨著客戶調整他們的貨架圖，這些往往會按季度和每年進行調整，因此可能會產生一些噪音。重要的是，我們始終將客戶 POS 視為最終用戶真實需求的指標。總的來說，我們的大客戶仍然領先去年。

Now let me turn to temperature control. Due to a cool spring, we experienced a very slow start to the season, especially when compared to 2022 and entered the third quarter down 5.2%. But as you know, it got quite hot across most of the country and remains so throughout the summer. Sales were up 5.3%, allowing us to post an all-time record for a quarter and bringing us back to within a point of last year's 9-month sales.

現在讓我談談溫度控制。由於春季涼爽，我們的產季開局非常緩慢，特別是與 2022 年相比，進入第三季下降了 5.2%。但如您所知，全國大部分地區都非常炎熱，並且整個夏天都如此。銷售額成長了 5.3%，創造了一個季度的歷史記錄，並使我們與去年 9 個月的銷售額相差不大。

Next, I'll speak to our Engineered Solutions segment, which is our non-aftermarket business focused on selling to manufacturers of vehicles and equipment across various end markets globally. Sales and Engineered Solutions were up 8.4% in the quarter, reflecting a combination of generally strong demand from key accounts and the benefit of new business wins. We're very pleased with how this business is going. We have built a program with a great combination of diverse products, end markets and geographies and are gaining traction as a capable supplier to blue chip accounts, and we believe the sky is the limit.

接下來，我將談談我們的工程解決方案部門，這是我們的非售後市場業務，專注於向全球各個終端市場的車輛和設備製造商銷售產品。本季銷售額和工程解決方案成長了 8.4%，反映出大客戶普遍強勁的需求以及新業務贏得的好處。我們對這項業務的進展感到非常滿意。我們已經建立了一個將多樣化產品、終端市場和地理完美結合的計劃，並且作為藍籌股的有能力的供應商而受到關注，我們相信天空是極限。

Turning to profitability. We are pleased to see strong gains, posting an EPS increase of 5.7% versus last year. Inflation persists with costs remaining elevated across materials, labor, rent and so on as well as the significant impact from rising interest rates affecting both our customer factoring programs and now borrowings. But through a combination of initiatives, we have largely been able to cover these cost increases, and I'm very proud of all of our people's efforts in this regard.

轉向盈利能力。我們很高興看到強勁的成長，每股收益比去年增長了 5.7%。通貨膨脹持續存在，材料、勞動力、租金等成本仍然居高不下，利率上升也對我們的客戶保理計畫和現在的借款產生了重大影響。但透過一系列舉措，我們基本上能夠彌補這些成本的增加，我對我們所有人在這方面的努力感到非常自豪。

So with that, let me turn it over to Nathan Iles, who will dive a bit deeper into the numbers and what's behind it.

因此，讓我將其交給內森·艾爾斯 (Nathan Iles)，他將更深入地研究這些數字及其背後的內容。

All right. Thank you, Eric. As noted before, our sales were up in the third quarter with increases in both the Temp Control and Engineered Solutions segment, which along with other actions, helped drive improvement in operating profit over last year. We also continue to make great progress reducing our inventory levels. As we go through the numbers, I'll give some more color on these items and other key drivers for the quarter and first nine months as well as provide an update on our financial outlook for the full year 2023.

好的。謝謝你，埃里克。如前所述，隨著溫度控制和工程解決方案部門的成長，我們第三季的銷售額有所成長，再加上其他行動，有助於推動營業利潤比去年有所改善。我們也在降低庫存水準方面繼續取得巨大進展。在我們瀏覽這些數字時，我將對這些項目以及本季和前 9 個月的其他關鍵驅動因素進行更多說明，並提供 2023 年全年財務前景的最新資訊。

First, looking at our Vehicle Control segment. You can see on this slide that net sales was $190.9 million in Q3 or down 3.4% versus a difficult comparison last year, with the decrease driven by the impact of the bankrupt customer as well as some customer pipeline orders, which did not recur this year. For the first nine months in vehicle control, sales were down slightly by 0.3%, with the decline showing both the impact of the customer bankruptcy as well as lower Q3 pipeline orders. But excluding these impacts, we've seen growth for the year so far as a result of continued demand for our products and favorable sell-through.

首先，看看我們的車輛控制部分。您可以在這張投影片中看到，第三季的淨銷售額為1.909 億美元，與去年相比下降了3.4%，下降的原因是破產客戶以及一些客戶管道訂單的影響，而今年沒有再出現這種情況。 。在車輛管制的前九個月，銷售量小幅下降了 0.3%，下降不僅反映了客戶破產的影響，也反映了第三季管道訂單減少的影響。但排除這些影響，由於對我們產品的持續需求和良好的銷售，我們今年已經看到了成長。

Vehicle Control adjusted EBITDA was 11.4% of net sales for the quarter and 11.9% for the first 9 months, with both periods down from last year. Looking at the drivers, we saw a nice expansion in the gross margin rate for vehicle control of 1.4 points in the quarter and 1.9 points for the first nine months. This expansion was a result of pricing and savings initiatives, which overcame cost inflation and the impact of lower production and lowering inventory. However, the improvement in gross margin was more than offset by a combination of higher factoring costs and lower operating expense leverage as a result of lower sales.

Vehicle Control 調整後的 EBITDA 本季佔淨銷售額的 11.4%，前 9 個月佔淨銷售額的 11.9%，兩個期間均低於去年同期。從駕駛者來看，我們看到車輛控制的毛利率在本季增加了 1.4 個百分點，在前 9 個月增加了 1.9 個百分點。這種擴張是定價和節約舉措的結果，克服了成本通膨以及產量下降和庫存減少的影響。然而，毛利率的提高被保理成本上升和銷售額下降導致的營運費用槓桿下降所抵消。

While Vehicle Control's adjusted EBITDA is down year-over-year, I would point out that we've made a lot of progress offsetting the headwinds we faced recently as our gross margin improvements outpaced the rising cost of factoring programs for both the quarter and the year so far.

雖然車輛控制的調整後EBITDA 同比下降，但我要指出的是，我們已經取得了很大進展，抵消了最近面臨的阻力，因為我們的毛利率改善超過了本季度和上一季度保理計劃成本的上升。今年到目前為止。

Turning to Temperature Control. Net sales in the quarter for that segment of $123.6 million were up 5.3%, while sales for the first nine months were down by 1% as we saw strong sales in the quarter mostly offset we've been a slow start to the selling season. Temperature Control's adjusted EBITDA was 11.9% of net sales in Q3 and slightly ahead of last year and was driven by two things primarily. First, strong sales combined with other initiatives to improve the gross margin rate and the second, the performance of our equity investments in our joint ventures in China, which falls below the operating profit line but improved in the quarter. The combination of these two things overcame the higher cost of customer factoring programs in the third quarter.

轉向溫度控制。該部門本季的淨銷售額為1.236 億美元，成長了5.3%，而前9 個月的銷售額下降了1%，因為我們看到本季的強勁銷售大部分抵銷了銷售季節開局緩慢的影響。第三季度，Temperature Control 調整後的 EBITDA 佔淨銷售額的 11.9%，略高於去年，主要由兩件事推動。首先，強勁的銷售與其他措施相結合，提高了毛利率；其次，我們在中國合資企業的股權投資業績雖然低於營業利潤線，但在本季度有所改善。這兩件事的結合克服了第三季客戶保理計畫的較高成本。

Temp Control adjusted EBITDA for the first nine months of 8.5% of net sales was down from last year as a slightly higher gross margin rate was more than offset by higher factoring costs so far this year. Looking at it in more detail. The impact on pricing and cost savings actions benefited the gross margin rate, but was partly offset by lower production related to lowering inventory levels. So while gross margin improved by 0.2 points to this segment, this was more than offset by higher interest rates on factoring programs as well as some lower leverage in SG&A costs due to lower sales.

Temp Control 前 9 個月調整後的 EBITDA 為淨銷售額的 8.5%，較去年有所下降，因為今年迄今較高的保理成本抵消了略高的毛利率。更詳細地看一下。對定價和成本節約行動的影響有利於毛利率，但部分被庫存水準降低導致的產量下降所抵銷。因此，雖然該細分市場的毛利率提高了 0.2 個百分點，但這完全被保理計畫利率上升以及銷售下降導致的 SG&A 成本槓桿率降低所抵消。

Looking at Engineered Solutions. Sales for that segment in the quarter of $71.8 million were up 8.4% and sales for the first nine months of $215.1 million were up 4%, and we were pleased to see our sales continue to increase as a result of strong demand in new business wins. Adjusted EBITDA for Engineered Solutions in the quarter came in at 15.6%, an increase of 4.6 points from last year. And for the first 9 months, adjusted EBITDA for Engineered Solutions was 13.4% and up 1.9 points from last year. The improvement for both the quarter and the year so far was the result of strong sales growth, good channel and customer mix, which improved the gross margin rate and better SG&A leverage given higher sales.

查看工程解決方案。該部門本季的銷售額為7,180 萬美元，成長8.4%，前9 個月的銷售額為2.151 億美元，成長4%，我們很高興看到由於贏得新業務的強勁需求，我們的銷售額繼續增長。本季工程解決方案的調整後 EBITDA 為 15.6%，比去年增長 4.6 個百分點。前 9 個月，工程解決方案的調整後 EBITDA 為 13.4%，比去年增加 1.9 個百分點。迄今為止，本季和全年的業績改善得益於強勁的銷售成長、良好的通路和客戶組合，這提高了毛利率，並且在銷售額增加的情況下提高了銷售、管理和行政費用(SG&A ) 槓桿率。

Turning to our consolidated results. Net sales in the quarter were up 1.3% due to higher sales of Temp Control and Engineered Solutions. And for the first nine months, sales were basically flat as growth in Engineered Solutions was offset by small declines in the aftermarket segment. Our consolidated gross margin rate improved for both the quarter and first nine months due to our initiatives that overcame other headwinds, the results in a gross margin dollar increase were of 7.5% to 4.9% for the quarter and first nine months, respectively.

轉向我們的綜合業績。由於溫度控制和工程解決方案銷售額增加，本季淨銷售額成長 1.3%。前九個月，銷售額基本上持平，因為工程解決方案的成長被售後市場領域的小幅下滑所抵消。由於我們克服了其他不利因素的舉措，我們的綜合毛利率在本季和前 9 個月均有所改善，本季和前 9 個月的毛利率分別增加了 7.5% 至 4.9%。

Regarding SG&A. Excluding the cost of customer factoring programs, which are shown separately on the stage, Expenses were well controlled in the quarter of 16.9% of net sales and in line with last year. Looking at the bottom line. Consolidated operating income was 9.1% and adjusted EBITDA of 11.4% in the quarter were higher than last year as higher sales and an improved gross margin rate across all segments offset $4 million of higher factoring costs. This also drove an increase in earnings per share of $1.11 in the quarter.

關於SG&A。除去在舞台上單獨顯示的客戶保理計畫的成本，該季度的費用得到了很好的控制，佔淨銷售額的16.9%，與去年持平。看看底線。該季度的綜合營業收入為 9.1%，調整後 EBITDA 為 11.4%，均高於去年，因為所有部門的銷售額增加和毛利率提高抵消了 400 萬美元的較高保理成本。這也推動本季每股收益成長 1.11 美元。

For the first nine months, consolidated operating income and adjusted EBITDA were down as higher factoring costs really partly offset by improvements in gross margin and has also resulted in lower diluted earnings per share for the year so far. However, I would also point out that while our operating profit is down $4.4 million in the first nine months, this is after absorbing a $14.2 million increase in factoring costs, which highlights the work we've done to offset the headwinds of rising interest rates.

前九個月，綜合營業收入和調整後 EBITDA 均有所下降，因為較高的保理成本確實部分被毛利率的提高所抵消，並且還導致了今年迄今為止稀釋後每股收益的下降。不過，我還要指出，雖然我們的營業利潤在前9 個月下降了440 萬美元，但這是在吸收了保理成本增加的1,420 萬美元之後，這凸顯了我們為抵消利率上升的不利因素所做的工作。

Turning now to the balance sheet and cash flows. The key item here is our inventory level, which finished Q3 at $479.8 million, down $48.9 million from December last year and down $54.5 million from September last year as we continue to focus on reductions in this area. Our cash flow statement reflects cash generated from operations in the first nine months of $132.9 million as compared to cash used of $75.5 million last year, with the improvement driven by $129.6 million improvement in cash flow from inventory during the first nine months.

現在轉向資產負債表和現金流量。這裡的關鍵項目是我們的庫存水平，第三季末庫存水準為4.798 億美元，比去年12 月減少了4,890 萬美元，比去年9 月減少了5,450 萬美元，因為我們繼續關注這一領域的削減。我們的現金流量表反映了前 9 個月營運產生的現金為 1.329 億美元，而去年使用的現金為 7,550 萬美元，這項改善是由前 9 個月庫存現金流量改善 1.296 億美元推動的。

Our financing activities show significant progress made in paying down our credit facilities by $92.1 million as a result of improved operating cash flows, including a $75.6 million worth of repayments made in the quarter. We also paid $18.8 million of dividends during the first 9 months. Our borrowings of $147.6 million at the end of Q3 were much lower than last year, and we finished the quarter with a leverage ratio of 0.8x lower than both September and December last year.

我們的融資活動顯示，由於營運現金流改善，我們在償還信貸額度方面取得了重大進展，償還了 9,210 萬美元，其中包括本季償還的 7,560 萬美元。我們還在前 9 個月支付了 1880 萬美元的股息。第三季末，我們的借款為 1.476 億美元，遠低於去年，本季結束時，我們的槓桿率比去年 9 月和 12 月低 0.8 倍。

Before I finish, I want to give an update on our sales and profit expectations for the full year 2023. Regarding our top line sales, we expect full year '23 sales will show flat to low single-digit percentage growth versus last year, given performance to date and the fact that Temp Control season is now largely finished. Adjusted EBITDA is expected to be approximately 9.5% and unchanged from our estimate last quarter. This estimate includes the full year sales performance as noted; factoring expenses of $48 million to $50 million using the current outlook for rates; some additional costs related to the expansion of distribution facilities in our new warehouse in Shawnee, Kansas; and a weaker U.S. dollar that while strengthening recently to still lower against the Mexican peso versus last year.

在結束之前，我想更新我們對 2023 年全年銷售額和利潤的預期。關於我們的營收，我們預計 23 年全年銷售額將與去年持平至低個位數百分比增長，因為迄今為止的表現以及溫度控制季節現已基本結束的事實。調整後 EBITDA 預計約為 9.5%，與我們上季度的預期持平。這項估計包括如上所述的全年銷售業績；使用當前費率前景，保理費用為 4,800 萬至 5,000 萬美元；與堪薩斯州肖尼新倉庫的配送設施擴建相關的一些額外費用；美元走弱，但近期兌墨西哥比索兌去年同期仍走低。

Next with adjusted EBITDA. We expect depreciation and amortization expenses and our income tax rate to be in line with 2022. Further, we expect our interest expense on outstanding debt to be on average about $4 million each quarter, given higher interest rates.

接下來是調整後的 EBITDA。我們預計折舊和攤銷費用以及所得稅率將與 2022 年保持一致。此外，考慮到利率較高，我們預計每季未償債務的利息支出平均約為 400 萬美元。

To wrap up, we were pleased with our overall higher sales in the quarter and our Temp Control and Engineered Solutions segment. And our improved gross margin rate across all segments as well as the continued significant improvement in cash flow that we saw, and we very much appreciate the efforts of all of our key members achieving these results.

總而言之，我們對本季整體較高的銷售額以及溫度控制和工程解決方案部門感到滿意。我們看到所有部門的毛利率都有所提高，現金流也持續顯著改善，我們非常感謝所有關鍵成員為實現這些成果所做的努力。

Thank you for your attention. I'll now turn the call back to Eric to wrap up.

感謝您的關注。現在我將把電話轉回給埃里克來結束。

Thank you, Nathan. So just to close, let me reiterate how pleased we were with our quarterly results. We posted record sales and showed strong growth in earnings. North American aftermarket continues to show its stability as the basic demographics of their market remain favorable. The car park is growing and aging, miles driven and rebounded. And while there can always be some noise quarter-to-quarter, the fundamentals remain excellent.

謝謝你，內森。最後，讓我重申一下我們對季度業績的滿意程度。我們的銷售額創歷史新高，獲利成長強勁。北美售後市場繼續表現出穩定性，因為其市場的基本人口結構仍然有利。停車場不斷擴大和老化，行駛里程不斷增加和反彈。儘管每季總是會出現一些噪音，但基本面仍然良好。

Technology shifts are surely coming, but there's nothing new about that, and we feel well positioned to evolve with it. So we really feel quite good about our future here. As for Engineered Solutions, we are, obviously, in a different stage of our journey. While we are well established in the aftermarket, here, we are just getting known. But the moves we have made in the past few years in creating a cohesive global business is clearly hitting its strat. We continue to receive opportunities across a host of products and end markets and are clearly seeing a strengthening in customer relationships that will surely open more doors. And as I always say, we are tackling with the best team out there, and I'm immensely grateful to all of our talented employees.

技術變革肯定會到來，但這並不是什麼新鮮事，我們感覺自己已經做好了隨之發展的準備。所以我們對這裡的未來感到非常滿意。至於工程解決方案，顯然我們正處於旅程的不同階段。雖然我們在售後市場已經站穩了腳跟，但在這裡，我們才剛剛被了解。但我們在過去幾年中為創建一個有凝聚力的全球業務所採取的舉措顯然正在達到其戰略目標。我們繼續在許多產品和終端市場中獲得機會，並且清楚地看到客戶關係的加強，這肯定會打開更多的大門。正如我常說的，我們正在與最好的團隊合作，我非常感謝我們所有才華橫溢的員工。

And so that concludes our prepared remarks. At this point, we'll open it up for questions. So I'll turn it back to you.

我們準備好的發言就到此結束。此時，我們將開放提問。所以我會把它還給你。

And we'll take our first question from the line of Daniel Imbro with Stephens.

我們將從丹尼爾·因布羅（Daniel Imbro）和史蒂芬斯（Stephens）那裡提出第一個問題。

Congrats in the quarter. Eric, maybe I'll start at a higher level. In the script, I think you mentioned that large customers in aggregate are still up, that kind of implies a positive industry backdrop. Are you seeing -- or how are you thinking any change in that outlook? Some participants are noting more repair deferrals. Curious if from your purview where you see a lot of customers, are you seeing anything changing in terms of sales trends or volume trends in the industry?

恭喜本季。埃里克，也許我會從更高的水平開始。在劇本中，我認為您提到大客戶總體上仍在成長，這意味著積極的行業背景。您是否看到—或者您認為這種前景有何變化？一些參與者註意到更多的維修延期。很好奇，從您的職責範圍來看，您看到了很多客戶，您是否看到該行業的銷售趨勢或數量趨勢發生了任何變化？

So that's a fair question. And what I would say is that, in general, we are seeing that kind of ongoing low single-digit growth within -- speaking specifically to vehicle control, temperature control, obviously, has a lot of movement to the weather. But I think we're basically back to that low single-digit long-term trends that the industry has always seen as it relates to any deferred maintenance and so on. A lot of our categories are not really maintenance related. They're hard failure. And so really, your car needs our products, you tend to not be able to (inaudible) very well. So we don't necessarily see any impacts from that, which could theoretically because in other categories by economic trends, we're really looking at the addressable market being stable and strong.

所以這是一個公平的問題。我想說的是，總的來說，我們看到這種持續的低個位數增長——特別是在車輛控制、溫度控制方面，顯然，天氣因素有很大的變化。但我認為我們基本上回到了行業一直看到的低個位數長期趨勢，因為它與任何延期維護等相關。我們的許多類別實際上與維護無關。他們是艱難的失敗。事實上，您的汽車需要我們的產品，但您往往無法（聽不清楚）做得很好。因此，我們不一定會看到任何影響，理論上可能會產生任何影響，因為在其他類別的經濟趨勢中，我們確實看到了目標市場的穩定性和強勁。

Understood. That's great. Maybe a couple on the Engineered Solutions segment. Results were really strong there, impressive profit growth. First, maybe how are you thinking about the fourth quarter? I know you had some light vehicle and domestic exposure. Is there any potential disruption from the ongoing UAW strike embedded in the guide? And then, Nathan, when we look at the margin performance, was there anything anomalous in there? Or is it mid-teens segment EBITDA-margin sustainable?

明白了。那太棒了。也許是工程解決方案領域的幾個。那裡的業績非常強勁，利潤成長令人印象深刻。首先，您對第四季有何看法？我知道您對輕型車輛和家庭有一定的了解。指南中所包含的正在進行的 UAW 罷工是否有任何潛在的干擾？然後，內森，當我們查看利潤率表現時，有什麼異常嗎？或者它的 EBITDA 利潤率是否可持續？

So as it relates to what we're seeing in Engineered Solutions right now, and I think you're specifically asking about any light vehicle impact. It's a relatively small portion of our overall sales, certainly. And even with engineered solutions, we service so many other end markets. We have really seen very nominal impact as a result of this strike and now it appears that at least with Ford, it's resolving itself. And so any impact really would have been minor and short term. So we don't really expect anything out of that.

因此，因為它與我們現在在工程解決方案中看到的內容有關，我認為您專門詢問了任何輕型車輛的影響。當然，這僅占我們總銷售額的一小部分。即使有了工程解決方案，我們也為許多其他終端市場提供服務。我們確實看到了這次罷工造成的名義上的影響，現在看來，至少對福特來說，它正在自行解決。因此，任何影響實際上都是微小且短期的。所以我們並不真正期望從中得到什麼。

So on the market for Engineered Solutions, I'd just point out, like we said before, that the customer base in this segment is very diverse. And we do expect to have some changes in margin quarter-to-quarter just because of the diverse mix of customers in the business. And so as I remarked before, really, a lot of the improvement was driven by an improved customer mix versus last year. On a long-term basis, I would just point you to the nine months numbers for this segment, which there showed a gross margin of 20.6% and probably closer to where the business settles out on a long-term basis. So I think that we would still believe that Engineered Solutions versus the aftermarket is comparable on an adjusted EBITDA basis.

因此，在工程解決方案市場上，我只想指出，就像我們之前所說的那樣，該細分市場的客戶群非常多樣化。我們確實預計，由於業務中客戶結構的多樣化，利潤率將出現季度與季度之間的一些變化。正如我之前所說，實際上，與去年相比，很大一部分的改進是由客戶組合改善所推動的。從長期來看，我只想向您指出該細分市場 9 個月的數據，顯示毛利率為 20.6%，可能更接近業務的長期穩定水平。因此，我認為我們仍然相信工程解決方案與售後市場在調整後的 EBITDA 基礎上具有可比性。

Great. That's helpful. And maybe last one for me, Nathan, on the guide on the EBITDA margin outlook. I think you maintained it at 9.5%. Obviously, 3Q was stronger than that. So can you maybe help us understand the outlook. Maybe what are the headwinds coming in the fourth quarter that we should be aware of as you thought about kind of keeping that guidance.

偉大的。這很有幫助。內森，也許最後一篇是關於 EBITDA 利潤率前景的指南。我認為你將其維持在 9.5%。顯然，3Q比那強。那麼您能否幫助我們了解前景。當您考慮保持這項指導時，也許我們應該注意第四季度會出現哪些不利因素。

Yes. So just the headwinds that I pointed out in the remarks around some of the incremental costs around the new warehouse as well as the FX that, at least, from the Mexican peso is still a little bit against us in the fourth quarter. I think to your point, obviously, adjusted EBIT is a bit stronger than the guide come out of Q3. But the other thing that will swing Q4 around a bit is the Temp Control business and the season as that comes to an end. The fourth quarter is always a lower profit quarter anyway. So that's what's inside the expectation.

是的。因此，我在評論中指出了圍繞新倉庫的一些增量成本以及外匯的不利因素，至少墨西哥比索在第四季度仍然對我們不利。我認為就你的觀點而言，調整後的息稅前利潤顯然比第三季的指導要強一些。但另一件將影響第四季業績的事情是溫度控制業務以及該業務即將結束的季節。無論如何，第四季始終是利潤較低的季度。這就是我們的預期。

I will take our next question from the line of Bret Jordan with Jefferies.

我將從布雷特喬丹（Bret Jordan）和杰弗里斯（Jefferies）那裡提出我們的下一個問題。

This is Patrick Buckley on for Brett. How are you guys thinking about inventory levels as we head into '24. Are we pretty close back to optimal or maybe some more work to be done there?

我是派崔克·巴克利（Patrick Buckley），代表布雷特發言。當我們進入 24 世紀時，你們如何看待庫存水準？我們是否已經非常接近最佳狀態，或者可能還需要做更多的工作？

Are you referring to inventory on our shelves or our inventory sitting on customer shelves?

您指的是我們貨架上的庫存還是客戶貨架上的庫存？

Yes, I suppose both would be helpful.

是的，我想兩者都會有幫助。

So I'll speak to the customer inventories and Jim can speak to ours. What we're really seeing is very rational stable inventory on our customers' shelves. You're always going to have a little bit of flexing quarter-to-quarter, period-to-period. But basically, it shows that there their inventory is really where they want it to be, and we work closely with them. So we have pretty good visibility into what their intentions are. So nothing really to note on customer shelves.

因此，我將與客戶庫存交談，吉姆可以與我們的庫存交談。我們真正看到的是客戶貨架上非常合理、穩定的庫存。每個季度、每個時期都會有一些調整。但基本上，這表明他們的庫存確實在他們想要的地方，而且我們與他們密切合作。所以我們很清楚他們的意圖是什麼。因此，顧客貨架上沒有什麼值得注意的地方。

This is Jim Burke. We're very pleased with the inventory performance that we had in the recent quarter and really year-to-date. So we took significant working capital down out of the business. At this point, going forward, we start to build inventories to the Temperature Control in. So vehicle control will probably be about neutral. Maybe we'll get a little bit of a benefit there. But from this point forward, we start to build and get ready for the next season there. But I'd say you should look at relatively reasonable levels, no significant changes.

這是吉姆·伯克。我們對最近一個季度和今年迄今的庫存表現非常滿意。因此，我們從該業務中削減了大量營運資金。此時，展望未來，我們開始建立溫度控制庫存。因此車輛控制可能處於中性狀態。也許我們會在那裡得到一點好處。但從現在開始，我們開始為下個賽季做好準備。但我想說你應該看看相對合理的水平，沒有重大變化。

Got it. That's helpful. And then as you look at cadence throughout the quarter, it sounds like momentum picked up towards the end after the colder spring. How have things progressed into Q4? And how much more tailwind are you guys expecting from the summer heat?

知道了。這很有幫助。然後，當你觀察整個季度的節奏時，聽起來像是在寒冷的春天之後，勢頭在接近尾聲時有所回升。第四季的進展如何？你們預計夏季炎熱會帶來多少順風車？

Well, really the summer season at this point is largely over. It -- so I wouldn't read too much into what happens in the few weeks of October. But yes, it was a strong summer, really throughout the third quarter, which, as we said, allowed us to recover from the slow start.

嗯，實際上夏季已經基本結束了。所以我不會過多地了解十月幾週內發生的事情。但是，是的，這是一個強勁的夏天，尤其是整個第三季度，正如我們所說，這讓我們從緩慢的開局中恢復過來。

(Operator Instructions)

（操作員說明）

Our next question comes from the line of Scott Stember with Roth MKM.

我們的下一個問題來自 Scott Stember 和 Roth MKM 的對話。

Congrats on the quarter. Some industry players have been talking about potential price disinflation. Are you starting to see any of that? I mean, obviously, you guys have put through a lot of price increases to cover raws, but -- and factoring costs. But what's your view on the pricing environment right now?

恭喜本季。一些業內人士一直在談論潛在的價格通貨緊縮。你開始看到這些了嗎？我的意思是，顯然，你們已經大幅提高價格來覆蓋原材料，但是——以及保理成本。但您對目前的定價環境有何看法？

Yes. We're really not seeing it in our categories, partly because they are not commodity driven. And so we've seen that the overall costs have not come down. Our costs have not come down. So we're not really seeing much. You obviously talked to the distributors as to what their pricing strategies are. And we're hearing, as you said, some different things. But we are really not seeing anything and we believe in our categories is nondiscretionary hard failure parts, they're not that price-sensitive [industry].

是的。我們確實沒有在我們的類別中看到它，部分原因是它們不是商品驅動的。所以我們看到整體成本並沒有下降。我們的成本並沒有下降。所以我們並沒有真正看到太多。您顯然與經銷商討論了他們的定價策略。正如你所說，我們聽到了一些不同的事情。但我們確實沒有看到任何東西，我們相信我們的類別是不可自由裁量的硬故障零件，它們不是對價格敏感的[行業]。

Got it. And back to the UAW strike. You talked about Engineered Solutions, but in vehicle control, is there any potential if you haven't seen it already for benefit in the aftermarket side?

知道了。回到UAW罷工。您談到了工程解決方案，但在車輛控制方面，如果您還沒有看到它在售後市場方面帶來的好處，那麼它是否有任何潛力？

That's also a great question. And the short answer is no. We really have not seen any impact. One of the things that we have been reading about is really that they had anticipated this, and it stocked up their parts distribution ahead of it, and they are not at zero. They are -- as we're reading, and I'm not saying anything that's not public information. But they have continued a kind of partial staff to operate those parts of the carbon. So no, it really has not had any impact on our whole channel really.

這也是一個很好的問題。簡短的回答是否定的。我們確實沒有看到任何影響。我們一直在讀到的一件事是，他們確實預料到了這一點，並且提前儲備了他們的零件分配，而且他們的庫存不是為零。正如我們正在閱讀的那樣，它們是，我不會說任何不屬於公開資訊的事情。但他們仍然保留了部分員工來操作碳的這些部分。所以不，它確實對我們整個管道沒有任何影響。

Got it. And then the guide for top line, a little bit lower. Is that really pertaining to vehicle control and the customer loss? Or is there anything else?

知道了。然後是頂線的指南，稍微低一點。這真的與車輛控制和客戶流失有關嗎？或是還有其他什麼嗎？

No. I think that's really it. And the fourth quarter can be somewhat volatile. As you know, as the end control season is largely over, and there could be adjustments. And so we're just taking a slightly conservative view on it and also looking at where we are after nine months. So yes, that's really (inaudible)

不，我認為確實如此。第四季可能會有些波動。如您所知，由於最終控制季節已基本結束，因此可能會進行調整。因此，我們只是採取稍微保守的觀點，並看看九個月後我們的情況。所以是的，這確實是（聽不清楚）

And then lastly, the bankruptcy, I think last quarter, you might have given what the impact to vehicle control sales were. Do you have that for this quarter?

最後，我認為上個季度的破產，您可能已經給出了對車輛控制銷售的影響。這個季度你有這個嗎？

Yes. It's -- we were able to provide some rough numbers prior to the pieces getting acquired because we're able to show a specific zero-revenue-type situation. Now that it's been acquired by other accounts, and it really just kind of gets lost in the mix as to what that impact is because it's been distributed across several different other customers, and all of the different dynamics within their businesses. So yes, we're at this point and really going forward as well. Unable to really specify what that impact is, but we just know that there is some overall softness as they rationalize with that.

是的。我們能夠在購買這些作品之前提供一些粗略的數字，因為我們能夠展示特定的零收入類型的情況。現在它已被其他帳戶收購，並且它實際上只是迷失在這種影響是什麼中，因為它分佈在幾個不同的其他客戶及其業務中的所有不同動態中。所以，是的，我們正處於這個階段，而且也在繼續前進。無法真正具體說明這種影響是什麼，但我們只知道，當他們對此合理化時，整體上存在一些軟弱。

And there appears to be no further questions at this time. I'll hand the call back over to speakers for any closing remarks.

目前似乎沒有進一步的問題。我會將電話轉回給發言者以供結束發言。

Thank you, and we want to thank everyone for participating in our conference call today. We understand there's a lot of information presented, and we'll be happy to answer any follow-up questions you may have. Contact information is available on our press release or our corporate website. And we hope you have a great day. Thank you.

謝謝大家，我們要感謝大家今天參加我們的電話會議。我們知道其中提供了大量信息，我們很樂意回答您可能提出的任何後續問題。聯絡資訊可在我們的新聞稿或公司網站上找到。我們希望您度過愉快的一天。謝謝。

Thank you, everyone.

謝謝大家。

This concludes today's conference. Thank you for your participation, and you may now disconnect.

今天的會議到此結束。感謝您的參與，您現在可以斷開連接。