Thermon Group Holdings Inc (THR) 2023 Q4 法說會逐字稿

Hello, and welcome to the Thermon Q4 2023 Earnings Conference Call and Webcast. (Operator Instructions) As a reminder, this conference is being recorded.

您好，歡迎參加賽盟 2023 年第四季度收益電話會議和網絡廣播。 （操作員指示）謹此提醒，本次會議正在錄製中。

It's now my pleasure to turn the call over to your host, Ivonne Salem, Vice President, FP&A and Investor Relations. Please go ahead, Ivonne.

現在我很高興將電話轉給東道主、FP&A 和投資者關係副總裁 Ivonne Salem。請繼續，伊馮。

Thank you, Kevin. Good morning, and thank you for joining today's fiscal 2023 fourth quarter conference call. Earlier this morning, we issued an earnings press release, which has been filed with the SEC on Form 8-K, and is also available on the Investor Relations section of our website. Additionally, the slides for this conference call can be found in our IR website under News, Event, IR Calendar Earnings Conference Call Q4 2023.

謝謝你，凱文。早上好，感謝您參加今天的 2023 財年第四季度電話會議。今天早上早些時候，我們發布了一份收益新聞稿，該新聞稿已以 8-K 表格的形式向 SEC 提交，也可在我們網站的投資者關係部分獲取。此外，本次電話會議的幻燈片可以在我們的 IR 網站中的“新聞、活動、IR 日曆、2023 年第 4 季度收益電話會議”下找到。

During the call, we will discuss some items that do not conform to generally accepted accounting principles. We have reconciled those items to the most comparable GAAP measures in the tables at the end of the earnings press release. These non-GAAP measures should be considered in addition to and not as a substitute for measures of financial performance reported in accordance with GAAP.

在電話會議期間，我們將討論一些不符合公認會計原則的項目。我們已將這些項目與收益新聞稿末尾表格中最具可比性的公認會計準則衡量標准進行了核對。這些非公認會計原則衡量標準應作為根據公認會計原則報告的財務業績衡量標準的補充，而不是替代。

I would like to remind you that during this call, we may take certain forward-looking statements regarding our company. Please refer to our annual report and most recent quarterly report filed with the SEC for more information regarding our forward-looking statements, including the risks and uncertainties that could impact our future results.

我想提醒您，在這次電話會議中，我們可能會做出有關我們公司的某些前瞻性陳述。請參閱我們向美國證券交易委員會提交的年度報告和最近的季度報告，了解有關我們前瞻性聲明的更多信息，包括可能影響我們未來業績的風險和不確定性。

Our actual results might differ materially from those contemplated by these forward-looking statements, and we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by law.

我們的實際結果可能與這些前瞻性陳述預期的結果存在重大差異，並且我們沒有義務公開更新任何前瞻性陳述，無論是由於新信息、未來發展還是其他原因，除非法律要求。

Now I would like to introduce Bruce Thames, our President and Chief Executive Officer for his opening remarks.

現在我想請我們的總裁兼首席執行官 Bruce Thames 致開幕詞。

Well, thank you, Ivonne. Good morning, everyone, and thank you for joining us today.

嗯，謝謝你，伊馮。大家早上好，感謝您今天加入我們。

Before we talk about a record quarter in the year, I'd like to start today by setting the stage with a brief overview of Thermon. As a 68-year-old company, we've been tested and proven resilient across many economic cycles. We're a world leader in providing safe, reliable and mission-critical industrial process heating solutions to customers in 85 countries from facilities on 4 continents.

在我們談論今年創紀錄的季度之前，我想首先簡要概述賽盟 (Thermon)。作為一家擁有 68 年曆史的公司，我們經過了多個經濟周期的考驗並證明了其彈性。我們是世界領先者，通過遍布 4 大洲的工廠為 85 個國家的客戶提供安全、可靠和關鍵任務的工業過程加熱解決方案。

Our almost 1,400 employees have an industry-leading safety record and are dedicated to creating value for our customers by executing our long-term strategic plan. And I'd like to thank all of them for contributing to our record performance in fiscal 2023. I'm looking forward to seeing what we can achieve together in the years to come.

我們的近 1,400 名員工擁有行業領先的安全記錄，並致力於通過執行我們的長期戰略計劃為客戶創造價值。我要感謝他們所有人為我們 2023 財年創紀錄的業績做出的貢獻。我期待看到我們在未來幾年能夠共同實現的目標。

On Slide 4, you can see our strategic pillars. In order to create long-term value for our shareholders, we remain focused on 3 key areas: first, profitably growing our installed base; second, diversification, digitization and decarbonization; and third, disciplined capital allocation.

在幻燈片 4 上，您可以看到我們的戰略支柱。為了為股東創造長期價值，我們仍然專注於三個關鍵領域：首先，以盈利方式擴大我們的安裝基礎；第二，多元化、數字化、脫碳化；第三，嚴格的資本配置。

In our first pillar, we benefit from a very large global installed base, which provides a significant opportunity to capture recurring revenues, while driving growth across our traditional and market verticals.

在我們的第一個支柱中，我們受益於非常龐大的全球安裝基礎，這提供了獲取經常性收入的重要機會，同時推動我們傳統和垂直市場的增長。

In our second strategic pillar, we're driving additional growth through expansion into attractive adjacencies across diverse end markets. Our solutions are also enabling decarbonization through electrification and the long-term transition towards sustainable energy sources.

在我們的第二個戰略支柱中，我們正在通過擴展到不同終端市場有吸引力的鄰接地區來推動進一步增長。我們的解決方案還可以通過電氣化實現脫碳以及向可持續能源的長期過渡。

In addition, we're expanding our digital solutions with products that utilize the industrial Internet of Things and support customer demand for enhanced productivity, reliability, efficiency and safety.

此外，我們還通過利用工業物聯網的產品來擴展我們的數字解決方案，並支持客戶對提高生產力、可靠性、效率和安全性的需求。

Underpinning our first 2 strategic pillars is our commitment to disciplined capital allocation. Given the strength of our balance sheet, our current priorities include inorganic growth through bolt-on acquisitions with returns that exceed WAAC by year 3 and when appropriate, returning capital to shareholders.

我們對嚴格資本配置的承諾是我們前兩個戰略支柱的基礎。鑑於我們資產負債表的實力，我們當前的優先事項包括通過補強收購實現無機增長，並在第 3 年實現超過 WAAC 的回報，並在適當的時候向股東返還資本。

Turning to Slide 5 and an update on our diversification efforts. As you can see, we continue to make solid progress on the strategic diversification of our end markets with ongoing wins across key markets such as rail and transit, where we saw growth of 29% in the year. Commercial was also up 29% and food and beverage grew 110% in the year.

轉向幻燈片 5，了解我們多元化努力的最新情況。正如您所看到的，我們在終端市場的戰略多元化方面繼續取得紮實進展，在鐵路和交通等關鍵市場上不斷取得勝利，今年增長了 29%。今年商業增長了 29%，食品和飲料增長了 110%。

In addition, we're seeing traction in other selected markets linked to long-term secular growth trends. In the alternative energy space, our revenue from nuclear power is up 16%, and our revenue from biofuels and green diesel is up 245%. We made inroads in the semiconductor end market with revenue up 15%, and our revenue from biotechnology end market is up over 200%.

此外，我們還看到其他選定市場的吸引力與長期長期增長趨勢相關。在替代能源領域，我們來自核電的收入增長了 16%，來自生物燃料和綠色柴油的收入增長了 245%。我們進軍半導體終端市場，收入增長15%，生物技術終端市場收入增長超過200%。

While the individual contributions from each of these market sectors is small today, in aggregate, they represent over $20 million of revenue in fiscal 2023, and we believe that the breadth of the total addressable market combined with our ability to grow share represents a solid growth opportunity in the years ahead.

雖然目前每個市場領域的單獨貢獻很小，但總的來說，它們在 2023 財年的收入超過 2000 萬美元，我們相信，整個潛在市場的廣度與我們擴大份額的能力相結合代表著穩健的增長未來幾年的機會。

Moving now to Slide 6 on our digitization strategy. Last quarter, we introduced you to the Genesis Duo, the latest addition to our market-leading digital platform, the Genesis Network. The platform provides customers with full operational awareness and supervisory control over their heat trace systems using industry-leading wireless mesh technology that connects all heat trace controllers back to the control room. This enables greater operational efficiency through increased uptime with fewer maintenance hours and costs.

現在轉到幻燈片 6，了解我們的數字化戰略。上季度，我們向您介紹了 Genesis Duo，這是我們市場領先的數字平台 Genesis Network 的最新成員。該平台使用行業領先的無線網狀技術將所有伴熱控制器連接回控制室，為客戶提供對其伴熱系統的全面操作意識和監督控制。這樣可以通過增加正常運行時間、減少維護時間和成本來提高運營效率。

This quarter, as we look back at the results of fiscal 2023, it's readily apparent that the benefits of this innovative digital platform are resonating with our customers. Adoption is increasingly accelerating with a 350% year-over-year increase in new circuits in fiscal 2023 and a growing pipeline of opportunities.

本季度，當我們回顧 2023 財年的業績時，很明顯，這一創新數字平台的優勢正在引起我們客戶的共鳴。隨著 2023 財年新電路數量同比增長 350%，以及機會不斷增加，採用速度不斷加快。

Using customer feedback, we continue to innovate the Genesis Network to provide expanded functionality for our customers with the latest software update released in April.

根據客戶反饋，我們繼續創新 Genesis Network，通過 4 月份發布的最新軟件更新為客戶提供擴展的功能。

Turning now to Slide 7 on enabling the energy transition. Here, you can see the rapid growth of our pipeline of opportunities and wins for projects that help enable the energy transition. This is an increasingly important part of our business, representing 8% of incoming orders in fiscal year '23, as our products and solutions support our customers in achieving their sustainability goals and contribute to overall decarbonization.

現在轉到幻燈片 7，介紹如何實現能源轉型。在這裡，您可以看到我們幫助實現能源轉型的項目機會和成果的快速增長。這是我們業務中日益重要的一部分，佔 23 財年新訂單的 8%，因為我們的產品和解決方案支持客戶實現可持續發展目標，並為整體脫碳做出貢獻。

On the right side of the slide, we have selected examples of our recent wins. Our innovative products and solutions are used across a variety of applications from renewable fuels to lithium-ion batteries and from carbon capture to thermal energy storage.

在幻燈片的右側，我們選擇了最近獲勝的示例。我們的創新產品和解決方案用於各種應用，從可再生燃料到鋰離子電池，從碳捕獲到熱能存儲。

On Slide 8, reviewing the external environment, I'd like to emphasize again the progress that we've made against our end market diversification strategy. Here, we see an updated chart with end market mix for the trailing 12-month period ending March 31, 2023. Approximately 61% of our revenue came from non-oil and gas end markets compared to roughly 45% in fiscal year '17, excluding our most recent acquisition, Powerblanket.

在幻燈片 8 中，回顧外部環境，我想再次強調我們在終端市場多元化戰略方面所取得的進展。在這裡，我們看到了截至 2023 年 3 月 31 日的過去 12 個月期間終端市場組合的更新圖表。我們約 61% 的收入來自非石油和天然氣終端市場，而 17 財年約為 45%，不包括我們最近收購的 Powerblanket。

Turning now to our full year results for fiscal year 2023 on Slide 9. Thermon achieved record revenue, adjusted EBITDA and EPS in fiscal 2023, driven by our team's continued outstanding execution despite ongoing macroeconomic volatility. Revenue of $440.6 million was up approximately 24% year-over-year, driven by strong demand in North America as well as a recent rebound in growth in Asia Pacific.

現在轉向幻燈片 9 上的 2023 財年全年業績。儘管宏觀經濟持續波動，但由於我們團隊持續出色的執行力，賽盟在 2023 財年實現了創紀錄的收入、調整後的 EBITDA 和每股收益。受北美強勁需求以及亞太地區近期增長反彈的推動，收入達到 4.406 億美元，同比增長約 24%。

More importantly, revenue from customer OpEx spending grew significantly compared to revenue from capital projects. This is indicative of greater exposure to growth of the recurring revenues from the installed base and less exposure to large upstream CapEx projects, which we believe that helps decrease the cyclicality of our business going forward.

更重要的是，與資本項目的收入相比，客戶運營支出支出的收入大幅增長。這表明來自已安裝基礎的經常性收入增長的風險更大，而大型上游資本支出項目的風險更少，我們認為這有助於降低我們未來業務的周期性。

Our profitability metrics were also robust during fiscal year 2023, driven by volume and improved gross margins. Record adjusted EBITDA increased approximately 60% year-over-year to $93.3 million with a margin of 21.2%. Adjusted EBITDA margin expanded 480 basis points in fiscal 2023 due to price, volume and operational excellence initiatives. As a result, free cash flow doubled to $48.3 million in the year. Finally, we achieved record adjusted EPS of $1.56 a share, a year-over-year increase of approximately 90%.

在銷量和毛利率提高的推動下，我們的盈利指標在 2023 財年也表現強勁。調整後 EBITDA 創歷史新高，同比增長約 60%，達到 9,330 萬美元，利潤率為 21.2%。由於價格、銷量和卓越運營舉措，2023 財年調整後 EBITDA 利潤率擴大了 480 個基點。結果，當年自由現金流翻了一番，達到 4830 萬美元。最終，我們實現了創紀錄的調整後每股收益 1.56 美元，同比增長約 90%。

Moving to Slide 10 and our fourth quarter fiscal 2023 results. Thermon delivered another quarter of outperformance with record revenue of $122.5 million, up 19% year-over-year due to sales growth across all geographies. Record Q4 adjusted EBITDA increased 37% to $25.1 million, driven by cost management and volume growth.

轉到幻燈片 10 和我們的 2023 財年第四季度業績。由於所有地區的銷售增長，Thermon 再次表現出色，營收達到創紀錄的 1.225 億美元，同比增長 19%。在成本管理和銷量增長的推動下，第四季度調整後 EBITDA 創歷史新高，增長 37% 至 2,510 萬美元。

Adjusted EBITDA margin expanded by approximately 260 basis points to 20.5% on improved gross margins and controlled spending. Free cash flow of $21.9 million was up 66%. Adjusted EPS was $0.41 a share, an increase of more than 30% from the prior year period.

由於毛利率提高和支出受控，調整後 EBITDA 利潤率擴大約 260 個基點，達到 20.5%。自由現金流達 2,190 萬美元，增長 66%。調整後每股收益為 0.41 美元，較上年同期增長 30% 以上。

If we look now to Slide 11, you can see that our orders and backlog continue to remain strong. We are very pleased with the momentum we're seeing in the business. This quarter, we achieved a record $132 million in incoming orders, up 17% year-over-year, while bookings on a trailing 12-month basis grew to $457 million, up 15%, an all-time high.

如果我們現在看幻燈片 11，您可以看到我們的訂單和積壓訂單繼續保持強勁。我們對業務的發展勢頭感到非常滿意。本季度，我們的新訂單額達到創紀錄的 1.32 億美元，同比增長 17%，而過去 12 個月的預訂量增長至 4.57 億美元，增長 15%，創歷史新高。

Our book-to-bill was 1.08x. This represents the tenth quarter of our last 13, where we've achieved a positive book-to-bill. Our backlog of $163 million was up 8% year-over-year, excluding FX impacts.

我們的訂單出貨比是 1.08 倍。這是我們過去 13 個季度中的第 10 個季度，我們實現了積極的訂單出貨比。排除匯率影響，我們的積壓訂單達到 1.63 億美元，同比增長 8%。

With that, I'd like to turn the call over to Kevin for a more in-depth review of our financial results. Kevin?

說到這裡，我想把電話轉給凱文，讓他對我們的財務業績進行更深入的審查。凱文？

Thank you, Bruce. Turning to revenue on Page 12.

謝謝你，布魯斯。轉向第 12 頁的收入。

Performance this quarter was outstanding as the global Thermon team continued to drive profitable growth, while meeting strong customer demand. Revenue in the fourth quarter was $123 million, up 19% versus prior year and exceeding internal expectations. We delivered strong growth in all geographies due to sustained demand and maintenance activity and we are seeing green shoots in Asia with the improvement from reduced travel restrictions.

本季度業績表現出色，賽盟全球團隊繼續推動利潤增長，同時滿足強勁的客戶需求。第四季度收入為 1.23 億美元，比去年同期增長 19%，超出內部預期。由於持續的需求和維護活動，我們在所有地區都實現了強勁增長，並且隨著旅行限制的減少，我們看到亞洲出現了復甦的苗頭。

While maintenance spending in the oil and gas market is the leading driver, growth in general industrial and renewable markets was robust and we are still focused on executing against our long-term goal of market diversification. By the end of fiscal 2026, we expect that at least 65% of total revenues will come from diversified markets other than oil and gas, up from 61% today and approximately 45% in fiscal 2017.

雖然石油和天然氣市場的維護支出是主要驅動力，但一般工業和可再生能源市場的增長強勁，我們仍然專注於執行市場多元化的長期目標。到 2026 財年末，我們預計總收入的至少 65% 將來自石油和天然氣以外的多元化市場，高於目前的 61% 和 2017 財年的約 45%。

FX negatively impacted revenue by $4 million due to the stronger U.S. dollar. Reported results also include Powerblanket financials were $5 million in revenue this quarter and $17 million in revenue since the acquisition in June of 2022. We are pleased that our integration of the Powerblanket deal is largely complete with the team now shifting focus to driving incremental growth through our shared channels to market and capitalizing on new product launches.

由於美元走強，外匯對收入產生了 400 萬美元的負面影響。報告的業績還包括 Powerblanket 本季度的財務收入為 500 萬美元，自 2022 年 6 月收購以來收入為 1700 萬美元。我們很高興我們對 Powerblanket 交易的整合已基本完成，團隊現在將重點轉向通過以下方式推動增量增長：我們共享市場渠道並利用新產品的發布。

Large project revenues were roughly flat in the quarter. As a reminder, we believe large overtime project revenues are aligned with customer capital spending budgets and are more cyclical in nature. Small projects and maintenance and repair revenues, which were up 31% and 24% in the quarter, respectively, and 17% and 29% on a TTM basis are representative of maintenance, repair and small upgrades on our installed base that help our customers maximize production, uptime and efficiency.

本季度大型項目收入大致持平。提醒一下，我們認為大型加班項目收入與客戶資本支出預算一致，並且本質上更具週期性。小型項目以及維護和維修收入本季度分別增長 31% 和 24%，按 TTM 計算分別增長 17% 和 29%，這代表了我們已安裝基礎上的維護、維修和小型升級，可幫助我們的客戶最大化生產、正常運行時間和效率。

Small projects and maintenance and repair revenue growth was driven by increased activity in design and supply projects, particularly in downstream oil and chemical end markets. Small projects and maintenance and repair revenues represented 79% of total revenue this quarter versus large project revenues of 21%. Over the last few years, management has reduced our dependence on large upstream CapEx projects, and we are now more aligned with the maintenance spending growth this cycle.

小型項目以及維護和維修收入的增長是由設計和供應項目活動的增加推動的，特別是在下游石油和化學品終端市場。小型項目以及維護和維修收入佔本季度總收入的 79%，而大型項目收入佔 21%。在過去的幾年裡，管理層減少了我們對大型上游資本支出項目的依賴，現在我們更加適應本週期的維護支出增長。

Now for gross margins and SG&A on Page 13. Gross margins in the quarter were 42.1% versus a reported 40.1% last year, representing incremental margins of over 52% due to growth in customer maintenance spending. In the fourth quarter of fiscal 2023, volume and pricing contributed an increase of 675 basis points. Supply chain headwinds were a negative 250 basis points. And while they have generally improved over the last year, there are still some pockets of challenges we continue to navigate.

現在介紹第 13 頁的毛利率和銷售、一般管理費用。本季度的毛利率為 42.1%，而去年報告的毛利率為 40.1%，由於客戶維護支出的增長，增量利潤率超過 52%。 2023財年第四季度，銷量和價格貢獻了675個基點的增長。供應鏈不利因素為負 250 個基點。儘管去年情況總體有所改善，但我們仍然面臨一些挑戰。

Year-end inventory adjustments and the impact from investments in continuous improvement contributed an additional headwind of 265 basis points. On an adjusted TTM basis, margins are up 170 basis points due to higher volume and pricing offsetting the previously mentioned headwinds.

年末庫存調整和持續改進投資的影響又造成了 265 個基點的額外阻力。在調整後的 TTM 基礎上，由於銷量和定價的增加抵消了前面提到的不利因素，利潤率上升了 170 個基點。

In the quarter, SG&A was $31.7 million or 26% of revenue versus the prior year of $23.5 million or 23% of revenue. On a trailing 12-month basis, SG&A was $107 million or 24% of revenue, up from $82 million and compared to 23% of revenue in the prior year, reflecting the acquisition of Powerblanket, higher variable costs within SG&A and our long-term investment in the decarbonization, digitization and diversification initiatives that we believe will drive the future growth of the business.

本季度，SG&A 為 3170 萬美元，佔收入的 26%，而上一年為 2350 萬美元，佔收入的 23%。在過去 12 個月的基礎上，SG&A 為 1.07 億美元，佔收入的 24%，高於上一年的 8200 萬美元，佔收入的 23%，反映出收購 Powerblanket、SG&A 內較高的可變成本以及我們的長期對脫碳、數字化和多元化舉措的投資，我們相信這些舉措將推動業務的未來增長。

We continue to focus on driving profitable growth, especially as we invest in the resources needed to execute our long-term strategic plan to diversify and scale the business. As you'll see on the next slide, the team has done an excellent job managing the balance between growth and profitability, and we will maximize the value of each dollar we invest in the business.

我們繼續專注於推動盈利增長，特別是當我們投資執行長期戰略計劃以實現業務多元化和規模化所需的資源時。正如您將在下一張幻燈片中看到的，該團隊在管理增長和盈利能力之間的平衡方面做得非常出色，我們將最大化我們投資於業務的每一美元的價值。

Moving on to Page 14 for adjusted EBITDA and earnings per share. This year's results represent the strength of the high-margin, low asset intensity Thermon business model as we continue to deliver margin expansion in a complex operating environment.

請參閱第 14 頁，了解調整後的 EBITDA 和每股收益。今年的業績體現了賽盟高利潤率、低資產密集度業務模式的優勢，我們繼續在復雜的運營環境中實現利潤率擴張。

Adjusted EBITDA was $25.1 million or 21% of sales in the quarter. Adjusted EBITDA increased 37%, up almost $7 million from the prior year, along with margin expansion of 260 basis points. On a trailing 12-month basis, adjusted EBITDA is now up to $93.3 million, a new record, along with margins of 21.2%, an expansion of 480 basis points year-over-year, a really fantastic result for the team.

調整後 EBITDA 為 2510 萬美元，佔本季度銷售額的 21%。調整後 EBITDA 增長 37%，比上年增加近 700 萬美元，利潤率擴大 260 個基點。在過去 12 個月的基礎上，調整後 EBITDA 現已達到 9,330 萬美元，創下新紀錄，利潤率為 21.2%，同比增長 480 個基點，這對團隊來說真是一個了不起的結果。

GAAP EPS in the fourth quarter was $0.23 per share, slightly down compared to the $0.26 per share in the prior year. Adjusted EPS was $0.41 per share versus last year's $0.31 per share. For the trailing 12-month period, GAAP EPS was $1 and adjusted EPS was $1.56 per share.

第四季度 GAAP 每股收益為 0.23 美元，較上年同期的每股 0.26 美元略有下降。調整後每股收益為 0.41 美元，去年為每股 0.31 美元。過去 12 個月期間，GAAP 每股收益為 1 美元，調整後每股收益為 1.56 美元。

Last quarter, we announced the exit of our operations in Russia. And as of March 31, the entity value has been written down to a nominal amount. This resulted in an impact to GAAP EPS of $0.13 per share in Q4 '23 and $0.35 per share for the full year.

上季度，我們宣布退出俄羅斯業務。截至3月31日，實體價值已減記至名義金額。這導致 23 年第 4 季度 GAAP 每股收益 0.13 美元，全年每股 0.35 美元。

We expect to complete the Russia exit by the end of the second quarter of fiscal 2024, subject to the receipt of regulatory approvals, and we do not anticipate any incremental material expenses associated with that process.

我們預計將在獲得監管部門批准的情況下，在 2024 財年第二季度末完成從俄羅斯的退出，並且我們預計不會出現與該過程相關的任何增量材料費用。

On Page 15, we'll cover the updated balance sheet. We ended the quarter with cash at $36 million. Despite the incremental borrowings for the Powerblanket acquisition, debt was $16 million lower year-over-year and combined with the substantial EBITDA growth, this resulted in a net debt to adjusted EBITDA ratio of 0.8x, an improvement versus 1.5x in the prior year.

在第 15 頁，我們將介紹更新後的資產負債表。本季度結束時，我們的現金為 3600 萬美元。儘管收購 Powerblanket 增加了借款，但債務同比減少了 1600 萬美元，再加上 EBITDA 的大幅增長，淨債務與調整後 EBITDA 的比率為 0.8 倍，比上一年的 1.5 倍有所改善。

We ended the quarter with lower working capital as a percentage of sales with a reduction in inventory from the elevated levels in recent quarters. We continue to navigate an improving, but not yet fully reliable supply chain environment while implementing many new operational and manufacturing changes to drive improved profitability in the quarters and years ahead.

本季度結束時，我們的營運資金佔銷售額的百分比有所下降，庫存也較近幾個季度的高水平有所減少。我們將繼續應對不斷改善但尚未完全可靠的供應鏈環境，同時實施許多新的運營和製造變革，以推動未來幾個季度和幾年的盈利能力提高。

Strong free cash flow of $21.9 million reflects 18% of revenue and 278% of net income in the quarter and a total of $48 million in fiscal 2023. Our low capital investment model yields significant free cash flow annually and the combination of our very strong balance sheet with low leverage provides optionality for capital allocation going forward.

2190 萬美元的強勁自由現金流反映了本季度收入的 18% 和淨利潤的 278%，以及 2023 財年的總計 4800 萬美元。我們的低資本投資模式每年產生大量的自由現金流，並且結合了我們非常強勁的平衡低杠桿表為未來的資本配置提供了選擇。

In fiscal 2023, we delivered significant volume growth, operating margin expansion and excellent free cash flow conversion, while improving the strength of our balance sheet and completing our first acquisition since 2017. This represents a big step forward in our plan to build a world-class industrial technology business.

在 2023 財年，我們實現了銷量顯著增長、營業利潤率擴張和出色的自由現金流轉換，同時改善了我們的資產負債表實力並完成了自 2017 年以來的首次收購。這代表著我們在建立世界-類工業技術企業。

While some uncertainty in the macro environment exists, we are seeing strong growth trends across all regions, supply chain costs and lead times are improving versus a year ago, and the industry-leading Thermon team continues to execute against its short- and long-term plans. We will continue to drive strong results and create value for shareholders in the years ahead.

儘管宏觀環境存在一些不確定性，但我們看到所有地區都有強勁的增長趨勢，供應鏈成本和交貨時間較一年前有所改善，行業領先的賽盟團隊繼續執行其短期和長期目標計劃。未來幾年，我們將繼續取得強勁業績，為股東創造價值。

Many thanks to the global Thermon team for the great work and commitment that enables us to deliver for our customers, shareholders and our communities.

非常感謝賽盟全球團隊的出色工作和承諾，使我們能夠為客戶、股東和社區提供服務。

And with that, I'll hand it back to Bruce.

有了這個，我會把它交還給布魯斯。

Thank you, Kevin. And I'd like you all turn to Slide 16 for our guidance for fiscal year 2024.

謝謝你，凱文。我希望大家參閱幻燈片 16，了解我們對 2024 財年的指導。

We are very pleased with the strength of our business as we move into this fiscal year. We believe the record results in fiscal 2023 have set a new baseline for us going forward.

進入本財年，我們對我們的業務實力感到非常滿意。我們相信 2023 財年創紀錄的業績為我們未來的發展設定了新的基準。

In order to continue to grow and execute our strategic initiatives, our fiscal 2024 plan includes an incremental $7 million in key investments, new product development, sales and business development. In addition, we anticipate investing approximately 3.5% to 4% of revenues in CapEx to fund strategic growth initiatives, capacity expansion and operational excellence.

為了繼續發展和執行我們的戰略舉措，我們的 2024 財年計劃包括在關鍵投資、新產品開發、銷售和業務開發方面增加 700 萬美元。此外，我們預計將收入的約 3.5% 至 4% 投資於資本支出，為戰略增長計劃、產能擴張和卓越運營提供資金。

Looking forward, we're mindful of the higher interest rates that could lead to a slowdown in spending that may result in a recession. However, our backlog is at or near record levels, is up 5% year-over-year, and our quote volumes and incoming order rates remain robust.

展望未來，我們注意到利率上升可能導致支出放緩，從而導致經濟衰退。然而，我們的積壓訂單已達到或接近歷史最高水平，同比增長 5%，而且我們的報價量和新訂單率仍然強勁。

Based on these factors, revenue guidance for FY '24 is projected to be from $455 million to $485 million for the full year, which at the midpoint represents approximately 7% growth over fiscal 2023. No M&A activity is included in these projections.

基於這些因素，24 財年全年收入指導預計為 4.55 億美元至 4.85 億美元，中間值較 2023 財年增長約 7%。這些預測中不包括併購活動。

For the full year, we anticipate GAAP EPS to be in the range of $1.45 a share to $1.61 a share, representing a 53% year-over-year growth at the midpoint. We expect to maintain a strong balance sheet throughout the year.

對於全年，我們預計 GAAP 每股收益將在每股 1.45 美元至 1.61 美元之間，中間值同比增長 53%。我們預計全年將保持強勁的資產負債表。

Moving to Slide 17 and our long-term revenue goals. Our growth goals for fiscal 2026 remain unchanged. We're very pleased that our performance through the first 2 years of our 5-year plan is in the upper range of our initial goals with fiscal 2023, significantly exceeding our expectations.

轉到幻燈片 17 和我們的長期收入目標。我們 2026 財年的增長目標保持不變。我們非常高興的是，我們 5 年計劃前 2 年的業績達到了 2023 財年初始目標的上限，大大超出了我們的預期。

We're encouraged by the ongoing advancements we're making around diversification with important growth across multiple end markets. The continued progress of our digitization strategy with accelerating adoption of our innovative digital platform and our new product development are creating sustainable competitive advantages in the marketplace.

我們在多元化方面不斷取得進步，在多個終端市場實現了重要增長，這讓我們感到鼓舞。我們的數字化戰略不斷取得進展，加速採用我們的創新數字平台和新產品開發，正在市場上創造可持續的競爭優勢。

And as we further align our sales and marketing activities to the long-term secular growth trends of the energy transition and decarbonization, we expect to capture additional market share by providing our customers with products and solutions that enable them to achieve their sustainability goals.

隨著我們進一步調整我們的銷售和營銷活動以適應能源轉型和脫碳的長期長期增長趨勢，我們期望通過為客戶提供產品和解決方案，幫助他們實現可持續發展目標，從而獲得更多的市場份額。

In addition to revenue growth, we believe that our operational excellence combined with leverage on our fixed costs will yield EBITDA margins in the low to mid-20% range going forward.

除了收入增長之外，我們相信，我們的卓越運營與固定成本的槓桿作用相結合，未來 EBITDA 利潤率將在 20% 的低至中水平範圍內。

Turning to Slide 18 and our capital allocation priorities. Our disciplined approach to capital allocation underpins our growth aspirations. First and foremost, we're committed to maintaining a healthy balance sheet across economic cycles, with a leverage target of 1.5 to 2x under normal conditions, while continually evaluating opportunities to return capital to our shareholders.

轉向幻燈片 18 和我們的資本配置優先事項。我們嚴格的資本配置方法支撐著我們的增長願望。首先，我們致力於在整個經濟周期中保持健康的資產負債表，正常情況下的槓桿目標為 1.5 至 2 倍，同時不斷評估向股東返還資本的機會。

We seek to drive organic growth by investing in people, technology and continuous improvement. These investments enable us to pursue our 3 strategic initiatives of decarbonization, digitization and diversification. Our reinvestment in the business through research and development and new product development has resulted in a robust vitality index representing [20%] of fiscal 2023 revenues.

我們尋求通過投資於人才、技術和持續改進來推動有機增長。這些投資使我們能夠實施脫碳、數字化和多元化三大戰略舉措。我們通過研發和新產品開發對業務進行再投資，產生了強勁的活力指數，佔 2023 財年收入的 [20%]。

Finally, we continue to evaluate M&A opportunities against our strategic and financial criteria as a means of building our industrial heating platform while diversifying our end markets. We target accretive return on invested capital to exceed WAAC by year 3.

最後，我們繼續根據我們的戰略和財務標準評估併購機會，作為構建我們的工業加熱平台同時實現終端市場多元化的手段。我們的目標是到第 3 年投資資本的增值回報率將超過 WAAC。

And wrapping up on Slide 19. Thermon is a leading global brand, providing safe, reliable and innovative mission-critical process heating solutions, serving high-value, diversified end markets with high barriers to entry. Our talented global team is committed to operational excellence and safely delivering results, while driving innovative product development that creates differentiated solutions in the marketplace.

幻燈片 19 結束。Thermon 是全球領先品牌，提供安全、可靠和創新的關鍵任務過程加熱解決方案，服務於進入壁壘較高的高價值、多元化終端市場。我們才華橫溢的全球團隊致力於卓越運營和安全交付成果，同時推動創新產品開發，在市場上創造差異化的解決方案。

Our large global installed base with long-standing customers is a significant competitive advantage, resulting in a resilient aftermarket franchise that generates high-margin recurring revenue. We believe that we are very well positioned to support our clients in achieving their sustainability goals, and to capitalize on the vast opportunity associated with the energy transition and decarbonization through the electrification of industrial heat.

我們擁有龐大的全球安裝基礎和長期客戶，這是一個顯著的競爭優勢，從而形成了富有彈性的售後市場特許經營權，從而產生高利潤的經常性收入。我們相信，我們完全有能力支持客戶實現可持續發展目標，並通過工業熱能電氣化利用與能源轉型和脫碳相關的巨大機遇。

Finally, our operating history has demonstrated that our business is resilient across economic cycles due to our high margin, low capital intensity model that generates meaningful free cash flow.

最後，我們的經營歷史證明，由於我們的高利潤率、低資本密集度模型能夠產生有意義的自由現金流，因此我們的業務在整個經濟周期中都具有彈性。

As we look ahead to fiscal 2024, I'm excited about the opportunities in front of us. Through the outstanding execution by our global team and the strength of our business, Thermon is ready to continue delivering profitable growth and creating value for our shareholders in the coming year and beyond.

當我們展望 2024 財年時，我對眼前的機遇感到興奮。憑藉我們全球團隊的出色執行力和我們的業務實力，賽盟已準備好在來年及以後繼續實現盈利增長並為我們的股東創造價值。

With that, I'd like to turn this back over to our moderator, Kevin.

說到這裡，我想把這個問題轉交給我們的主持人凱文。

(Operator Instructions) Our first question today is coming from Brian Drab from William Blair.

（操作員說明）我們今天的第一個問題來自威廉·布萊爾的布萊恩·德拉布（Brian Drab）。

This is Tyler on for Brian. Just to start out, looking at your gross margin in the fourth quarter, I know you explained the headwinds, but is there any reason it was down sequentially from the other quarters? Were the headwinds larger than previous quarters?

這是泰勒替布萊恩發言。首先，看看您第四季度的毛利率，我知道您解釋了不利因素，但是有什麼原因導致它比其他季度連續下降嗎？阻力是否比前幾個季度更大？

Yes, Tyler, this is Kevin. Maybe a few things to call out on the gross margin side of things.

是的，泰勒，這是凱文。也許在毛利率方面有一些值得注意的事情。

Obviously, the volume was quite strong. Pricing was still positive in the quarter. But if we really kind of reflect internally some of those inventories for the higher cost purchases in previous periods, really start to get consumed at the end of the heating season. So that was a little bit a headwind.

顯然，成交量相當強勁。本季度定價仍然樂觀。但如果我們真的在內部反映一些以前時期成本較高的採購庫存，那麼在供暖季節結束時確實開始消耗。所以這有點逆風。

We had some adjustments for year-end inventory. But as we think about the continuous improvement side of things, we've really been investing in the business there. We completed over 47 kaizen events in the last year. And as you pivot from a push to a pull model through the plant, you take a look at the inventories, and there's a little bit of hit there we had in the quarter. But I think the good news here is a lot of that is behind us. And if you think about the opportunity sequentially going forward, we still have pricing power in the market.

我們對年末庫存進行了一些調整。但當我們考慮事物的持續改進方面時，我們確實一直在投資那裡的業務。去年我們完成了超過 47 項改善活動。當您在工廠中從推式模型轉向拉式模型時，您會查看庫存，發現我們在本季度受到了一些打擊。但我認為好消息是很多事情已經過去了。如果你考慮一下未來的機會，我們仍然在市場上擁有定價權。

We think we've got some of those higher cost input items more or less behind us. And we certainly, given the guidance for fiscal '24, I think volume is going to be higher in the years ahead. So I think we still feel fairly positive about margins improving going forward.

我們認為我們已經或多或少地擺脫了一些成本較高的投入項目。當然，考慮到 24 財年的指導，我認為未來幾年的銷量將會更高。因此，我認為我們對未來利潤率的改善仍然相當樂觀。

Sounds good. Yes, that kind of just leads into my second question, like with the strong revenue guidance. Like is there a reason that the EPS guidance is any higher? Or is there a potential for upside throughout the fiscal year?

聽起來不錯。是的，這引出了我的第二個問題，就像強勁的收入指引一樣。每股收益指引是否有更高的理由？或者整個財年是否有上漲的潛力？

Yes. Tyler, I think we take a look at what's going on in the world and whether it's geopolitical events in Europe or some of the discussion that's going on in Washington, there's elections up in the Western province in Canada, there's just a little bit of maybe hesitation, I think, that we're seeing from a customer standpoint that we wanted to factor into the bottom line.

是的。泰勒，我認為我們應該看看世界上正在發生的事情，無論是歐洲的地緣政治事件還是華盛頓正在進行的一些討論，加拿大西部省份即將舉行選舉，也許有一點我認為，猶豫是我們從客戶的角度看到的，我們希望將其納入底線。

So I think at the end of the day, where we are here in May, that would be the expectation for the year. But I think generally speaking, the guide feels good for where we are today.

所以我認為歸根結底，我們五月在這裡，這將是對今年的期望。但我認為總的來說，指南對我們今天的處境感覺良好。

Sounds good. And just touching on the maintenance spending. Do you have pretty good visibility of that throughout fiscal '24 as opposed to like the CapEx projects?

聽起來不錯。剛剛談到維護支出。與資本支出項目相比，您對整個 24 財年的情況是否有很好的了解？

Yes. We do -- we get a good sense for our customers' budgets. The vast majority of them are on an annual kind of -- the calendar year when they look -- as they look at their budgets. Particularly, if you look at some of the more traditional end markets, commodity pricing is high, the overall margins are good. They've got money to spend.

是的。我們確實如此——我們對客戶的預算有很好的了解。他們中的絕大多數人在查看預算時都是按年度（他們查看的日曆年）進行。特別是，如果你看看一些更傳統的終端市場，商品定價很高，整體利潤率很高。他們有錢可以花。

And right now that we haven't seen huge CapEx spending. So what we've seen is kind of a shift of investment in -- kind of current asset base to improve throughput, uptime, reliability and maximize the assets they have in place to be able to meet kind of volume demand.

目前我們還沒有看到巨額資本支出。因此，我們看到的是對現有資產基礎的投資轉變，以提高吞吐量、正常運行時間、可靠性，並最大限度地利用現有資產，以滿足數量需求。

So we believe the environment for ongoing maintenance is robust and expect that those levels of spend to continue into this year.

因此，我們相信持續維護的環境是強勁的，並預計這些支出水平將持續到今年。

And Tyler, maybe to bring it full circle then, if we think about that mix that Bruce is alluding to, as you guys are aware, that's obviously generally a higher-margin business than some of the more project-based activity.

泰勒，如果我們考慮一下布魯斯所提到的混合，正如你們所知，這顯然是比一些基於項目的活動利潤率更高的業務。

We reached the end of our question-and-answer session. I'd like to turn the floor back over to Bruce for any further or closing comments.

我們的問答環節結束了。我想將發言權交還給布魯斯，以徵求進一步的意見或結束意見。

Thank you, Kevin, and thank you all for joining us today. We appreciate your interest and your investment in Thermon, and enjoy the rest of your day.

謝謝你，凱文，也感謝大家今天加入我們。我們感謝您對 Thermon 的興趣和投資，祝您度過愉快的一天。

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.

謝謝。今天的電話會議和網絡廣播到此結束。此時您可以斷開線路，度過美好的一天。我們感謝您今天的參與。