Q4 2021 AZZ Inc Earnings Call
[music].
Good morning, and welcome to the AZZ, Inc, fourth quarter and fiscal year 2021 financial results Conference call. All participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero on.
After todays presentation, there will be and opportunity to ask questions to ask a question you May Press Star then one on your Touchtone phone sales.
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I'd now like to turn the conference over to Joe Dormie Managing partner. Please go ahead.
Thank you good morning, and thank you all for joining us today to review the financial results for AZZ, Inc. For the fourth quarter and fiscal year 2021 ended February 28 2021.
Joining the call today are Tom Ferguson, Chief Executive Officer, Philip Sloane, Chief Financial Officer, and David <unk>, Senior Vice President marketing Communications and IR.
After the conclusion of today's prepared remarks, we'll open the call for a question and answer session.
Please note there is a slide presentation for today's call, which can be found on Azz's Investor Relations page under latest earnings release presentation at Www Dot AZZ Dot com.
Before we begin with prepared remarks, I'd like to remind everyone. Certain statements made by the management team of AZZ. During this conference call constitute forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.
Except for the statements of historical fact, this conference call may contain forward looking statements and involve risks and uncertainties. Some of which are detailed from time to time and documents filed by AZZ with the Securities and Exchange Commission, including the annual report on form 10-K for the fiscal year ended February 28, 2021 and those.
And those risks and uncertainties include but are not limited to changes in customer demand and response to products and services offered by the company, including demand by the power generation markets electrical transmission and distribution markets, the industrial markets and the metal coating markets prices and raw material costs, including zinc and natural gas, which are used and the heart.
Dip galvanizing process changes and the political changes and the political stability and economic conditions of the various markets that AZZ serves foreign and domestic customer requested delays of shipments acquisition opportunities currency exchange rates adequate financing and availability of experienced management and employees to <unk>.
And that the Companys growth strategies, and addition, azz's customers and its operations could potentially be adversely impacted by the ongoing COVID-19 pandemic.
The company can give no assurance that such forward looking statements will prove to be correct. These statements are based on information as of the date hereof and AZZ assumes no obligation to update any forward looking statements, whether as a result of new information future events or otherwise with that out of the way, let me turn the call over to Tom Ferguson, Chief Executive Officer of AZZ.
Tom.
Thanks, Joe and.
And welcome to our fourth quarter and full year fiscal 2021 earnings call and thank you for joining US this morning for.
First I need to express my great appreciation for the way our AZZ employees their families and our partners stepped up during the COVID-19 pandemic and also during the winter storm that impacted a significant portion of our production just two weeks before the end of our fiscal year.
Due to the concerted and in some cases extra ordinary efforts of our employees, we were able to quickly respond and finish out a profitable fourth quarter.
Overall annual sales declined 21% versus the prior year record, reaching $839 million with metal coatings down, 8% to $458 million and infrastructure solutions declining by 32% to $381 million.
The lower volumes were driven primarily by the impact on our customers caused by the COVID-19 pandemic as well as the divestitures, we made during the year.
I will get into the details of this as we go along.
We're pleased to have completed on 34th consecutive year of profitability and while COVID-19 negatively impacted our results we were able to take several actions to better position AZZ for the future.
We continued to generate strong cash flow during the year with $92 million and net cash provided by operating activities. We generated adjusted net income of $55 million and adjusted EPS of $2.11 per diluted share we were successful and completing the divestiture of our SMS and galvo bar businesses during the year we.
Closed a couple of galvanizing plants due to both local market conditions and the proximity of our other plants that can efficiently absorbed the majority of their business we.
We also closed the surface technology plant and idled and coating lines two of which were recently brought back on line.
In line with our strategic commitment to value creation, we repurchased over one 2 million shares for $48 three.
And $3 million and distributed $7 $6 million in dividends.
And metal coatings, we posted sales of 458 million, while achieving operating margins of 23, 3% on on adjusted basis up nicely from the previous year.
And the margin improvement was primarily due to driving operating efficiencies and productivity and the face of rising labor and energy costs.
And the team completed the acquisition of Acme Galvanizing in Milwaukee and near the end of the fiscal year.
We remain committed to delivering on the investments made and our surface technology business, but it is important to note the customers for this business for more severely impacted by COVID-19 than on the galvanizing side.
Our infrastructure solutions segment was severely impacted by the COVID-19 pandemic, particularly and the early part of the year sales declined over 32% to $381 million.
Adjusted operating income down, 52% generating adjusted margins of four 1% we.
We divested the SMS business since it was deemed to be non core to our long term strategy restructuring and impairment charges for infrastructure solutions totaled $9 $2 million for the year.
For fiscal 2022, COVID-19 continues to generate some uncertainty, but our folks are managing disruptions well and keeping our employees safe. So we are reaffirming our previously issued guidance, we anticipate sales to be and the range of 835 to 935 million and EPS of $2.
And 45 cents to $2.95 metal coatings is continuing to focus on sales growth, including leveraging our spin galvanizing operations at several sites operational and they are also focused on operational execution and customer service as labor and operating expenses.
Due to material cost inflation are increasing.
Our infrastructure solutions segment has seen and gradual return to more normalized business activity and entered Q1 with some momentum.
Our industrial business is seeing good results from our expanded Poland facility, although globally. The business continues to experience some intermittent and project delays due to COVID-19 outbreaks as certain customer sites.
The electrical platform is focused on operational execution and growing its E house and switchgear businesses.
For fiscal year 2022, AZZ will continue to execute on our strategic growth objectives that drive shareholder value at our core we are a metal coatings company and a manufacturer of products and provider of services that are critical to sustaining and infrastructure.
Our commitment to superior customer service is unwavering and our ability to generate strong cash flow is based on initiatives and drive operational excellence manage cost and share pricing discipline and yep.
Emphasis on receivables collection within our operating platforms, and we're confident that our businesses remain vital to improving and sustaining infrastructure. So we are actively working to position our core businesses to provide sustainable profitability long into the future.
And with that said I'll turn it over to Philip Thanks, Tom.
For the fourth quarter of fiscal year 2021, we reported sales of $195 6 million $49 7 million or 23% lower than the fourth quarter of fiscal year, 2020 gross.
Gross margin of $45 8 million for the quarter was $5 3 million or 10, 4% below prior year. However, gross margins rose to 23, 4% of sales compared to 28% and the prior year fourth quarter, a 260 basis point improvement year over year.
Net income for the quarter was $16 2 million.
Compared to a loss of $10 6 million and the comparable prior year fourth quarter, where the company has recorded a loss on sale of our nuclear logistics business and recorded charges related to the impairment of assets within the infrastructure solutions segment.
Reported diluted EPS for the quarter was <unk> 63 per share.
As Tom had earlier indicated full year fiscal 2021 sales of $838 9 million were down 21% compared to the prior year sales of one point over $6 billion larger.
Largely as a result of the impact for the business from the pandemic divestitures and lower revenues in China as we continue to execute on our existing China backlog.
Gross margins and.
As reported improved to 22, and 5% from 22, 3% on a year over year basis on stronger on stronger metal coatings performance, partially offset by the impacts of the pandemic within our industrial and electrical platforms, which are part of our infrastructure solutions segment.
Reported operating profit for the year of $61 6 million.
And was $17 7 million or 22, 3% lower than the prior year.
Operating profit and the current year was reduced $20 million as a result of our second quarter restructuring and impairment charges as well as losses recorded on the divestitures of metal coatings, Galvo bar business and infrastructure solutions SMS business during the year.
Reported operating margin of seven 3% were down 20 basis points from the prior year.
Full year operating profit as adjusted was $81 $6 million 25, and a $5 million or 23, 8% lower than the prior year's adjusted operating profit of $107 million.
Mostly as a result of the impact on the infrastructure solutions business, where they were impacted more strongly by the energy market downturn and the pandemic.
EBITDA for fiscal year, 'twenty, one was $105 $2 million compared with $128 5 million and the prior year.
Due to the lower current year earnings, partially offset by a reduction in tax expense and the current year as compared to the prior year.
Full year EBITDA as adjusted for impairment and restructuring charges was $125 2 million for a 19, 9% decrease from prior year's adjusted EBITDA of $156 3 million.
Cash flow from operations and the career of $92 million or 50 million $53 million or <unk> 35, 3% lower compared to the prior year on lower net income higher non cash charges in the prior year and fluctuations in working capital during the year.
During the year, we continued to invest and the business and regards to capital allocation, we were successfully able to navigate tougher market conditions and accomplish the following.
We repurchased $48 3 million and outstanding shares.
We refinanced our $125 million five for 2% senior notes with an upsized offering of $150 million over 7% and 12 year periods bearing interest under 3%.
Resulting in two and a $5 million of lower annual interest expense.
Even with the pandemic, we were able to reduce debt $24 million ending our fiscal year with $170 million 179 million and borrowings as compared to 203 million and borrowings at the end of last year.
We continued to support growth initiative by internally investing $37 1 million and capital projects. During the year, we completed our Houston spin plant as well as the expansion and modernization of our Poland manufacturing and operations facility we.
We acquired one galvanizing and planning operations and January 2020 one.
We divested as Tom and noted and our closed underperforming operations during the year and we continued to pay quarterly dividends.
We maintain a strong balance sheet with plenty of liquidity and continue to evaluate capital allocation strategies as we've progressed further on our strategic alternatives.
Lastly.
And we improved our internal controls over financial reporting and successfully Remediated, our previously reported material weakness related to our tax accounting.
With that I'll turn it back to Tom.
Thanks, Philip here.
And here's some key indicators that we are paying particular attention to for the metal coatings segment's galvanizing business, we are carefully tracking fabrication and construction activity material and labor cost inflation and progress of infrastructure legislation.
For surface technologies, we are primarily focused on expanding our customer base and some of our customers may take considerable time and getting back to normal production.
For infrastructure solutions, we are off to a decent start with turnaround and outage activity, having returned to a normal level and the fall season is currently looking to be quite good.
And the electrical platform is benefiting from transmission and distribution and utility spending and increasing data center and battery battery energy storage activity.
Finally for corporate we are focused on completing the strategic review of infrastructure solutions and replacing our credit facility.
We remain committed to our growth strategy around metal coatings, and achieving 21% to 23% operating margins with galvanizing performance being quite steady as we continue to improve surface technologies.
We will remain acquisitive, particularly and galvanizing for infrastructure solutions, we will continue to focus on profitable growth on our core businesses are.
And our infrastructure solutions business units should benefit for more normal turnaround and outage seasons, and a solid market for T&D utility and datacenter E houses and switch gear.
And with that we'll open it up for questions.
We will now begin the question and answer session and ask a question you May Press Star then one on your Touchtone phone.
You are using a speakerphone please pick up your handset before pressing Nicky.
Withdraw your question. Please press star two.
Yeah.
Our first question today comes from John <unk> with Sidoti and company.
Good morning, guys.
First regarding the quarter.
Could you talk about the winter storms impact may be on the fourth quarter, if there's any been.
There has been any deferred revenue for.
First quarter, 2020 two.
I think during the first quarter, we were impacted during the last couple of weeks for the year, mostly here in north, Texas up through the Midwest a little bit.
A lot of our business was able to recover during the last two weeks for the year, but there would be some carryover we believe into the first quarter.
It's pretty minor though.
Meaning just a couple of million dollars or or beyond that scope.
Brian not even that much.
Okay Alright.
Can you talk a little bit about horizon's zinc costs, you mentioned in your prepared remarks, Tom and roughly about 30 a pound.
What kind of headwind that presents us and Europe.
Right.
And I think we're seeing them.
Zinc costs have been fairly stable now for a little while so and that $1 25 to $1 30 range.
And I think it's down and even a little bit more than that right now, but that likely to two two.
To be an all cash.
Call It about 25 26 range and.
And if it stays there are you know our costs.
We've already.
Got a lot.
And think about six months of normal inventory and our kettles. So you know, we don't look for tremendous headwinds or even significant headwinds in the first part of the year.
Okay, Great and you.
And said that the.
Turnaround season, and was looking better and the whole.
But closer to home, what's the spring turnaround season, and look like relative to last time, we spoke a couple of months ago.
Yes, it's active we're deploying on quite a few projects. We've only had one that I'm aware of that.
And then where the crude has been pulled back because of COVID-19.
On one international job so for the most part it's active.
I'm, just really significantly better than the spring of last year.
We don't have any what I'd call whales, no no mega projects, but a good stream of activity.
And a lot of those.
Because there have been delays a lot of them are having good scope.
Growth is were getting on site so.
And it should be a good solid.
Season.
Okay, I'll get back into queue, and let somebody else take questions alright. Thanks, Sean.
Our next question comes from Noelle Dilts with Stifel.
Hi, guys and congrats on finishing out a tough year.
Yeah, Thanks and well.
And of course, so my first question and.
Fixed with the lineup just raw material in place and I was hoping you could speak to how you're thinking about you know steel costs that have escalated and how that impacts the cost side of your business on.
Within industrial for example, and.
And then if you're seeing any impact on demand as it relates to metal coatings and interest.
Generally being produced with steel.
Yeah, I think on the on the raw material for particularly for on the electrical side, where were they buy a lot of.
Metal for fabrication.
For the most part.
We have relatively short cycle times and in terms of from the time, we quote to the time.
Time of job book, So we're only talking on a matter of when.
<unk>, maybe a couple of months so for the most part we're able to work on.
Those increased costs into our bids.
And so I'd say that the vast majority of so far what what has been happening on the.
Metal coating side.
We are seeing so far we haven't seen a lot of either cancellations or.
Delays because of the either availability on steel or the cost of steel, but we are hearing more of that and the marketplace and so you know it.
It doesn't pose a headwind at the moment, but definitely something we're paying close attention to and because we do have a lot of our fabricators that are run and tight on.
Deal availability for the projects.
And then longer term and I'd say as we get towards the latter part of the year if for steel.
Continues to appreciate and cost we could see that happen and haven't creating some headwinds for us.
But for the moment.
It's a it's just mostly noise.
Okay. That's helpful.
And then I was hoping you could expand a bit on just some of them to keep the trends youre seeing and the key metal coatings markets I'm always interested and what you're hearing on on T. N D galvanizing on.
Sorry T&D.
Solar and and then the industrial and infrastructure markets.
Yes, so theres been active we've seen an uptick there and its debt.
And that's always good for for Hot dip galvanizing. So that's been positive quite a bit of a transmission distribution pole activity.
And including some of the five G stuff and.
And so.
And we're.
We're feeling fairly bullish on on where that's been going in and.
AG has been good I think we've seen that coming out of the floods from the prior year. So we've seen quite a bit of AG activity throughout the Midwest and.
Which is positive for our sites and the other thing we were not expecting to see a lot of recreation stuff that we have seen some of that too and strangely enough a lot of docs and the <unk>.
So it's a it's been relatively positive and the major markets.
Ben Good we even have a pretty good sized petrochemical project that we have we've seen some.
Activity on and and so.
Just generally positive.
Okay.
Great.
And then obviously a lot of you know a headline and.
For information and the news about them.
Potential stimulus Bill could you speak to how you kind of think about your exposure to some of the categories that have been proposed state and I understand you know the ultimate the ultimate Bell will likely be.
Something different from what we're looking at today, but that's sort of how are you thinking about the opportunity there.
Yes.
The difficulty for us is that by the time this.
Any of the actual spin flows into our our customer based on our fabricators for.
For the most part.
We're not looking and much and we're not expecting much impact this year. So it really starts to.
Give us a little more excited about maybe next year, but.
Almost any infrastructure spend is good for for our our metal coatings business, but when it.
Comes on the.
Electrical power Gen and and transmission distribution and we know the grid has to continue to be updated and expanded particularly as we saw here in Texas through the through the winter storm. So that's good for not just our metal coating side. That's also good for infrastructure solutions.
But I, but right now we're just looking at it we're paying close attention.
Is it more impacts mood, I guess and and optimism.
And if something got done so.
But it would it would definitely play into as we're looking at our facilities capacity and our capital deployment.
As we get through this year and into the next year.
Great. Thank you very much.
Thanks Doyle.
Again, if you have a question you can press star one and join our call.
Our next question is a follow up from John <unk> with Sidoti and company.
Yes could you just talk about the tax rate that you're occurred and the fourth quarter and what we should be thinking about 2022.
Yeah, our tax free finished up last year.
A little bit higher.
And then we'd like to seen we.
Finishing up the year, we're at just over 22% on.
Might see a little bit of an uptick 'twenty through 'twenty, three and 5%, but I think we are.
We're going to hover in that range going forward at this point and time.
Unless theres, obviously, a tax bill change.
And any thoughts about capital spending.
And we did $97 million last year.
And is that low.
The company's currently configured and 2022.
And I think Youll see we spend a little more last year, because we had a couple of growth initiatives. So you will see that capital spending come down a bit this year, while we're continuing to invest and the business. So I think we're and the $25 million of maintenance type spending and you'll probably see us on the $30 million to $35 million on a full year spend.
Okay.
Okay, and just one last question about labor.
Labor costs or is there any issue as far as on personnel are you fully staffed.
Martin did return and kind of give us an update.
Yes, we are fully staffed and but we are.
We've had to enhance our recruiting programs and.
And the cost of entry level.
Craft has been increasing and we would look for that to continue.
I guess the good news is were spread across 60 locations and and so generally we're pulling from a lot of.
A lot of markets and in some cases for markets that are.
And in the major metropolitan areas. So.
But it's definitely something we have a lot of focus on and resources deployed to make sure. We can can access people and and we are having to use some temp agencies, probably a little bit more of and then.
Well, let's say than we like but.
And we've had two and the and.
The last couple of years.
But generally you know you look at the labor as a percentage of our total cost depending on which business. We wanted to talk about.
It's manageable and.
And.
Okay and comment on on pay for him.
Alright, thanks, guys.
But what's the pipeline look like.
And have you considered just curious what kind of enough.
Hudson Bay.
Yes, I think.
And we're normally.
We're normally a relational kind of buyer for the most part and so there's there are some things.
There.
And just places and in North America that we can't get to and without quarantining for days or a week. So.
We have a really really solid pipeline just slowed by.
The impact of COVID-19 and like I said I think the thank all of my officers that have been vaccinated now so for the most part we do intend we're ready to travel.
And get to the location, so that we can and <unk>.
Some cases get into due diligence, but and in most cases just finalized negotiations.
And.
I wish I could say, we were going to get something done.
This quarter, but.
It just looks like everything is dragging out and extra quarter or two in terms of our normal activity levels. So while we'd like to get two or three deals done.
Usually in the early part of the year, we don't have.
We just don't have anything teed up that way so.
But we will get some deals done this year and we've got enough in the pipeline to ensure that we can do that.
And entered it and it is loosening up so we are getting out more and and people are more willing to to see us or even travel here in fort worth and so.
Thank you to follow ups I appreciate it.
Our next question comes from Deforest, Hinman, with Walt House and and Pal.
Hi, and thanks for taking the questions.
And for Us.
Hey, good morning.
Can you give us an update in terms of.
And your outlook on share repurchase activity and kind of wrapping that with the strategic review are we.
Precluded from buying stock is hard and the strategic review.
Blackout or anything.
We're subject the force to normal blackout.
Well I shouldn't say that actually we're on a <unk> one day and so we arent subject to that we've got some restrictions on that but we've been and the market continuing to buy stock.
Opportunistically.
And we're evaluating that as part of the strategic review as to you know.
On pricing, but we've continued to be and the market post February 28.
Okay. That's helpful. And then just any color on the strategic review from a.
Our benchmark perspective.
And from a timing perspective, you know we're waiting on.
The consultant to give us something.
It's already been received or reviewing it.
And as the board looked at something and any color you can provide there and some very helpful to shareholders.
Yeah, we actually had on her first in person meeting with the with one of the advisers Act.
A couple of weeks ago. So.
And that was encourage you and that's actually not a knock on anybody it's just got to let you know the process.
This is a complex.
Project and were doing going through a thorough analysis.
We've received preliminary.
Packages to review, we've had at least one review and excellent probably too with the board.
But.
We still have have.
Two or three fairly significant work streams in front of us.
And that will continue on through the summer so.
And then dependent and hopefully dependent on that progress will we'll be able to tighten up.
And give you some some more definitive milestones.
And hopefully by the time, we talk next time.
Okay and just one final question on that has the board given.
Costs are the consultants deadline in terms of what they would like this to be completed and and obviously COVID-19 and <unk>.
On a ranch and some things, but tentatively a date on when you think this will be <unk>.
<unk>.
Yes, I think.
We probably started out with a with.
A timeframe and mine not realized and you know how much extra time was going to be involved because of COVID-19 and doing video calls instead of in person.
Faq.
Finding meeting meetings, and sessions and and being able to travel to sites and stuff like that so.
And I think where I'd leave it is we've got a lot of questions that are being explored we've got.
Several work streams and.
And and it's proceeding.
We're now on a good pace.
Like I said, we had are not that it was a kickoff meeting we had on our first face to face meeting.
Just a couple of weeks ago and.
And we'd had a lot of video calls before then and a lot of Teleconferences and our focus for.
For now and probably through the next quarter or so is just making sure those that infrastructure solutions performs.
That our operations day.
Safe and functioning and and we're able to take care of our customers.
And minimize the distractions on the businesses.
And as they focus on that.
Because it is still there are still a lot of.
Complexities with maintaining.
Manufacturing operations and field service deployments.
In the face of COVID-19 so.
So that's our focus right now.
Okay. That's helpful and I'd like to just ask you to provide a little bit more color on the earlier comment is it really there's no availability.
And it seems like from what I've been reading a lot of steel companies working very hard to keep volumes up.
Some commentary that some of the distributors may be unwilling to take a lot of inventory and the short term with price and still elevated.
Is there.
From your perspective.
A lack of inventory available.
Broadly is it certain types of steel are not available.
Color you provide in terms on what's happening on the ground and be very helpful.
Yeah, I think it's for US it's spotty Theres some places.
And I don't know.
Getting into any specific geographies or or customer groups.
It's just general fabrication on large projects, there and they're able to manage through this but.
But you've got some of those mid sized projects, where they are running into.
I hesitate to call it shortages right now and just delays and.
And I think the bigger concern is over the cost depreciation and as that starts to come.
Come into the justification on whether projects remain financially viable or not.
So far I don't.
And I don't think we've seen anything actually.
And of any significance cancel.
So it's just right now, it's just delays and and a lot of extra work to to.
To access the inventories they or the steel they need.
And not I don't think its any particular, well I beams and things like that some of the structural stuff.
I think it's a little harder to get to.
And and and maybe that's more above.
And our stocking issue.
Okay. That's helpful. Thanks for taking the question.
And you have further questions. Please press star one.
Our next question is a follow up from Noelle Dilts with Stifel.
Thanks, again, so I was hoping you could expand just a little bit on how youre thinking about the margin profile for the two divisions in fiscal 'twenty two.
And you know I think for us on the galvanize the metal coatings margin came in a little bit ahead of our expectation. So do you think you can kind of sustain margins above the high and at that target, 21% to 23% range that you've talked about in the past on.
Any color there would be helpful. Thanks.
I think.
They had some they had some nonrecurring one time things that helped them and the fourth quarter.
Hmm and the factor there one time.
But I think they're generally running.
I'd like to think they're going to be and the.
Above the midpoint of that range and so call it for 22, 23%.
And and of course, as Theyre doing that sometimes theyre going to be able to pop above it.
As we.
Right now surface technology is not a big part of.
Of what we do but as they continue to stabilize and improve those operations.
And that's going to you know.
Help us trend towards the upper end of that range.
And Noel this is Phil on the other side of the infra.
Infrastructure solutions and electrical I think we've seen the bottom.
And there you know early last year, so as we progress hopefully these businesses are stabilized and will.
And we'll see better business going forward and hopefully, we'll see some margin improvement there as well yeah. Our focus there right now is building the backlog back in and some of the businesses and.
And theres still pulled down by that little bit of oil patch that they have exposure to but we still want to trend those back to double digit operating margin is.
Strategically that's that's where we think they should be and.
And we think they can get there, particularly as we've divested SMS, which was.
Low low single digit if you will operating margin business.
That tended to have some flow.
And fluctuation greater than its size.
So I think were were.
We're better positioned with the with what we have and.
And and.
We've got a better spread.
And WSI and the industrial piece that are around the world. So that we can take advantage of some of the the refinery turnaround activity and other parts of the world and we're just not as dependent on the U S. As we used to be.
Right.
Okay that was that's it for me thanks.
Thanks Noel.
Our next question comes from Bill Baldwin with Baldwin Anthony Securities.
Hey, good morning Thomas.
Hi, Bill.
Yeah.
You mentioned.
And the outlook for the grid and continued spending on the grid.
Looks like it's going to continue to be pretty good over the next several years.
And you indicated that and is it positive.
And also for you.
And infrastructure business could could you be.
For specific as far as the particular products.
That you think will primarily benefit from continued spending to improve day.
The grid on yet.
Yes, the enclosures E houses.
Really well positioned given our three locations.
Outside of Baltimore.
Baltimore, and then and in Chattanooga and.
Uh huh.
Pittsburgh, Kansas.
And then the.
Switch gear businesses.
We like our.
Fulton, which is more of the utility grade.
Switch gear is well positioned in Missouri.
And then up and Oshkosh, we've got more of the industrial Muni kind of switch.
Switch gears. So we just like the range of products, we have and feel good about our locations.
On the operations and are in a COVID-19 disrupted year, we're able to really focus on their efficiencies.
And dry and improving their operations and.
So we're bullish on.
E houses and switch gear and we've got the additional opportunities.
And the house side coming from data centers and.
On a battery storage so.
So we're very bullish there and then galvanizing hot dip just as soon as you get into.
Polls and and hardware and.
Yeah, and solar or any of the renewables for.
For the most part.
Good steel and <unk>.
And that's good for our galvanizing business.
And so I would tell you that.
Our other business as may benefit so.
Bus systems, a little bit but it.
It does not really.
And it was in their sweet spot.
Yes.
And secondly can you.
Give us a little feel for the <unk>.
And also business internationally.
Outside of Europe.
Specially well they've been there's been more of your traditional and legacy.
Electrical and industrial business.
We don't have much.
Aside the U S and we've got the China work and we see the drop in our backlog and the big chunk of the drop and the backlogs a reduction and the China orders, we've been working on for the last couple of years and Havent taken a whole lot of new orders in China.
Although it took one but yes.
And so there is activity I think being competitive and because of the travel restrictions are our executives that would normally be traveling from the U S to Saudi or to China.
It's just not happening so.
So I think that just it creates a little bit of a hurdle for us.
So as travel opens up and once again I mentioned, both most of our folks are accelerated.
And I can travel.
And I look for that as we get through into the second and into the summer.
Okay.
Your your JV over there and Saudi Arabia is still active.
It is.
It's open for business and I think.
And.
Yes.
Yeah, I think we could see some activity over there that would be good.
And that could be a plus.
And some interesting developments.
I'll just throw one out here to see.
You know what.
And you might be.
And at all considering any kind of international activities for your coatings business flow.
Yeah and international if you want to call you know.
North America outside of the U S.
Okay and you guys.
For North America right.
And we're pretty much as a framework for future.
Alright, I can back into your bill. Thank you Bill.
This concludes our question and answer session I would like to turn the call back over to Mr. Tom Ferguson for any closing remarks.
And I just think thank everybody for being.
And being on the call with us today, and I look forward to finishing out our first quarter and being able to give you more.
More and deeper updates on our progress on the infrastructure solutions evaluation work and that effort.
As well as looking forward to reporting out our first quarter is a much more normalized.
Q1 versus what we were talking about last year. So look forward to that update and a couple of months. Thank you.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.