Q1 2024 MSA Safety Inc Earnings Call
Operator: Good day, and welcome to the MSA Safety First Quarter 2024 Earnings 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. After today's presentation, you will have an opportunity to ask questions. You may press a star than one on your touchtone phone to withdraw your question. Please press a star then to. Please note that this event is being recorded.
Good day and welcome to the MSA safety first quarter 'twenty 'twenty four earnings 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.
After todays presentation, you will have an opportunity to ask questions to ask a question you May Press Star then one on your Touchtone phone to withdraw your question. Please press Star then two please.
Operator: Please note. This event is being recorded I would now like to turn the conference over to Chris Hepler.
Chris Hepler: Thank you. Good morning, and welcome to MSA's first quarter 2024 earnings conference call. This is Chris Hepler, Executive Director of Corporate Development. I'm joined by Nish Vartanian, Chairman and CEO, Steve Blanco, President and COO, Lee McChesney, Senior Vice President and CFO, and Stephanie Shulow, President of Our America Segment. Larry D. Maria, who we recently announced as Executive Director of Investor Relations, is also with us this morning. During today's call, we will discuss MSA's first quarter financial results and provide an update on our full year 2024 outlook.
Good morning, and welcome to Msa's first quarter 2024 earnings Conference call. This is Chris Boerner Executive director of corporate development.
Chris Hepler: I'm joined by Nish, Vartanian, Chairman and CEO, Steve Blanco, President and C. O M Lima, Chesney, Senior Vice President and CFO and Stephanie Shaw President of our Americas segment, Larry de Maria who we recently announced as executive director of Investor Relations is also with US This morning.
During today's call, we will discuss Msa's first quarter financial results and provide an update on our full year 2020 for outlook.
Chris Hepler: On slide 2, I'd like to remind everyone that matters discussed during this call may include forward-looking statements within the meaning of the Private Security Litigation Reform Act of 1995. Such statements include, but are not limited to, all projections and anticipated levels of future performance. Forward-looking statements involve a number of risks, uncertainties, and other factors that may cause our actual results to differ materially from those discussed today. These risks, uncertainties, and other factors are detailed in our SEC filings.
On slide two I'd like to remind everyone that matters discussed during this call may include forward looking statements within the meaning of the private security.
Chris Hepler: Litigation Reform Act of 1995 forward looking statements include but are not limited to all projections and anticipated levels of future performance forward looking statements involve a number of risks uncertainties and other factors that may cause our actual results to differ materially from those discussed today.
Risks uncertainties and other factors are detailed in our SEC filings MSA safety undertakes no duty to publicly update any forward looking statements made on this call except as required by law.
Chris Hepler: MSA Safety undertakes no duty to publicly update any forward-looking statements made on this call, except as required by law. Turning to slide 3, we have included certain non-GAAP financial measures as part of our discussion this morning. The non-GAAP reconciliations are available in the appendix of today's presentation. The presentation and press release are available on our investor relations website at investors.msasafety.com. I'd now like to turn the call over to Nish Vartanian. Thanks, Chris. And good morning, everyone.
Nishan J. Vartanian: Turning to slide three we have included certain non-GAAP financial measures as part of our discussion this morning.
Nishan J. Vartanian: non-GAAP reconciliations are available in the appendix of today's presentation. The presentation and press release are available on our Investor Relations website at investors thought MSA safety Dot com.
Chris Hepler: I'd now like to turn the call over to Nish Vartanian Nish.
Nishan J. Vartanian: Thanks, Chris and good morning, everyone.
Nishan J. Vartanian: As you're aware, on February 22, we announced a CEO succession plan. On May 10, I'll be turning over the CEO role to my colleague, Steve Blanco. I'm thrilled the board has selected Steve for the role following a rigorous multi-year succession planning process. Many of you know Steve already, but for those of you who don't, he is an outstanding leader with deep expertise in MSA's business and our industry. He's passionate about MSA's mission and values, and he puts the customer at the center of everything we do. Steve and I have worked closely together since he joined the company in 2012.
Nishan J. Vartanian: As you are aware on February 20, <unk>, we announced a CEO succession plan on May 10, I'll be turning over the CEO role to my colleague Steve Blanco.
Nishan J. Vartanian: I'm thrilled the board has selected speed to the wall following a rigorous multiyear succession planning process.
Nishan J. Vartanian: Many of you know Steve already but those of you who don't feed is an outstanding leader with deep expertise in msas business and our industry.
Nishan J. Vartanian: Passionate about MSA mission and values and he puts the customer at the center of everything we do.
Nishan J. Vartanian: Stephen and I have worked closely together since he joined the company in 2012, he's been an invaluable partner over this time and together we have significantly improved the performance of NSA.
Nishan J. Vartanian: He's been an invaluable partner over this time, and together, we have significantly improved the performance of MSA. As we enter the 110th year of our great company, MSA has never been in a better position. With this foundation of strength and resilience, I have the utmost confidence in Steve's ability to lead MSA and continue the momentum we've achieved together to drive value for all stakeholders in the years ahead. With that, I turn it over to Steve to take you through the core. Steve
Steve: As we entered the 110th year of our Great Company MSA has never been in a better position.
Nishan J. Vartanian: With this foundation of strength and resilience I have the utmost confidence in steves ability to lead NSA you continue the momentum we've achieved together to drive value for all stakeholders in the years ahead.
Nishan J. Vartanian: With that let me turn it over to Steve to take you through the quarter.
Nishan J. Vartanian: Sure.
Steven C. Blanco: Thank you, Nish, and good morning, everyone. First, I want to thank Nish and our Board of Directors for their trust and confidence in me to lead MSA Safety and our more than 5,000 associates around the world. The work done over the past several years executing our strategy has helped transform MSA into a higher growth, higher margin, and more efficient company. As Nish said, our company has never been stronger or positioned better for the future.
Steve: Thank you Mitch and good morning, everyone first I want to thank mission and our board of directors for their trust and confidence in me to lead MSA safety and our more than 5000 associates around the world.
Steven C. Blanco: The work done over the past several years executing our strategy has helped transform MSA into a higher growth higher margin and more efficient company.
Steven C. Blanco: As Mitch said, our company has never been stronger or position better for the future.
Steven C. Blanco: As we move forward, we will continue to leverage our scale, brand, and customer-centric innovation to drive profitable growth. My leadership team and I are devoted to serving our customers in support of our singular mission of safety. On behalf of my fellow MSA associates, I want to thank Nish for his significant contributions, leadership, and dedicated years of service. He's always demonstrated a passion for our mission, our employees, and our customers. Nish has been instrumental in transforming MSA into the company it is today.
Steven C. Blanco: As we move forward, we will continue to leverage our scale brand and customer centric innovation to drive profitable growth.
Steven C. Blanco: Our leadership team and I are devoted to serving our customers in support of our singular mission of safety.
Steven C. Blanco: On behalf of my fellow MSA Associates I want to thank niche for his significant contributions leadership and dedicated years of service. He has always demonstrated a passion for our mission.
Steven C. Blanco: Our associates and our customers niche has been instrumental in transforming MSA into the company. It is today.
Steven C. Blanco: I'm energized to build on this momentum as we enter the next phase of profitable growth, and I look forward to sharing more details with you at our upcoming Investor Day on May 22. As you'll see on slide 4, MSA is a purpose-driven growth company with a unique mission that men and women may work in safety and that they, their families, and their communities may live in health throughout the world. This mission has remained the same throughout MSA's 110-year history.
Steven C. Blanco: Energized to build on this momentum as we enter the next phase of profitable growth.
Steven C. Blanco: And I look forward to sharing more details with you at our upcoming Investor day on May 22nd.
Steven C. Blanco: As you'll see on slide four MSA as a purpose driven growth company with a unique mission that men and women may work in safety in a day their families and their communities. They live in health throughout the world.
Steven C. Blanco: This mission has remained the same throughout Msas 110 year history is the safety company, we are committed to advancing our mission and helping our customers address their safety needs.
Steven C. Blanco: As a safety company, we are committed to advancing our mission and helping our customers address their safety needs. Safety continues to be an attractive market with long-term growth tailwinds. Customers around the world remain focused on enhancing their safety programs, and we strive to be their partner of choice. Innovation and customer centricity are at the heart of everything we do.
Steven C. Blanco: Safety continues to be an attractive market with long term growth tailwind our customers around the world. We remain focused on enhancing their safety programs and we strive to be their partner of choice.
Steven C. Blanco: Innovation and customer Centricity are at the heart of everything we do we have a proven process that brings to life unique solutions that help solve our customers' toughest safety challenges as.
Steven C. Blanco: We have a proven process that brings to life unique solutions that help solve our customers' toughest safety challenges. As a result, we have established strong positions around the world in firefighter safety, detection, and industrial PPE products and solutions. We will continue to deliver market-leading innovation, complemented by inorganic growth, as you've seen in the past from us, to help us better serve our customers, and our team will leverage the MSA business system to continually drive enhanced performance in all we do.
Steven C. Blanco: As a result.
Steven C. Blanco: Stablish strong positions around the world and firefighter safety detection and industrial PPE products and solutions, we will continue to deliver market, leading innovation complemented by inorganic growth as you've seen in the past from us to help us better serve our customers.
Steven C. Blanco: And our team will leverage the MSA business system to continually drive enhanced performance in all we do.
Steven C. Blanco: Now let's look at our Q1 performance on slide five. We're off to a solid start this year, sustaining the positive momentum from our record 2023. The team executed well and delivered sales growth of 4% and earnings growth of 18%. Backlog in the quarter continues to be slightly elevated, specifically in detection and industrial PPE due to certain supply chain challenges.
Steven C. Blanco: Now, let's look at our Q1 performance on slide five.
Steven C. Blanco: We're off to a solid start this year sustaining a positive momentum from our record 2023.
Steven C. Blanco: The team executed well and delivered sales growth of 4% and earnings growth of 18%.
Steven C. Blanco: Backlog in the quarter continues to be slightly elevated specifically in detection and industrial PPE due to certain supply chain challenges.
Steven C. Blanco: The operating environment remains dynamic, and the team did a good job of navigating these challenges to continue delivering solutions to our customers. Moving on, to our product category. Sales in firefighter safety were strong, up double digits in the quarter. We saw strength across our head-to-toe firefighter solutions and delivered on the remaining FCBA units for the initial Air Force order we received last year. The fire service market continues to be resilient, and the environment for funding around the world is helping.
Steven C. Blanco: The operating environment remains dynamic and the team did a good job of navigating these challenges to continue delivering solutions to our customers.
Steven C. Blanco: Moving on to our product categories.
Steven C. Blanco: Sales and firefighter safety were strong up double digits in the quarter, we saw strength across our head to toe firefighters solutions and delivered on the remaining at CBA units for the initial Air Force Order, we received last year.
Steven C. Blanco: The fire service market continues to be resilient in the environment for funding around the world is healthy.
Steven C. Blanco: We recently attended the Fire Department International Conference in Indianapolis, and it was a pleasure to engage with our customers, channel partners, and our MSA Fire Service team. We just launched an exciting new product, the Carnes 1836 Fire Helmet, which incorporates customer feedback regarding comfort, weight, ergonomics, and cleanability.
Steven C. Blanco: We recently attended the fire Department International Conference in Indianapolis, and it was a pleasure to engage with our customers channel partners and our MSA fire service team.
Steven C. Blanco: We just launched an exciting new product the Karnes 18, 36 fire helmet, which incorporates customer feedback regarding comfort weight ergonomics and cleanability.
Steven C. Blanco: It was great to see the enthusiastic response to this helmet, as well as our broad range of firefighter products and solutions. However, our sales of detection and industrial PPE were down mid single digits in the quarter. Although order activity was healthy, our conversion was slow due to supply chain issues, which were more pronounced in our shorter cycle products, including portable gas detection and fall protection. We finished the quarter with higher backlogs in both detection and industrial PPE.
Steven C. Blanco: It was great to see the enthusiastic response to this element as well as a broad range of firefighter products and solutions.
Steven C. Blanco: Our sales in detection and industrial P. P were down mid single digits in the quarter.
Steven C. Blanco: Although order activity was healthy our conversion was slow due to supply chain issues, which were more pronounced in our shorter cycle products, including portable gas detection and fall protection.
Steven C. Blanco: We finished the quarter with higher backlog in both detection and industrial P. P.
Steven C. Blanco: While the supply chain continues to be volatile, we're working closely with our suppliers and remain confident in our path forward. We continue to build out our detection portfolio with innovative new products. For fixed gas and flame detection, we recently launched the FO5000, which has the latest advanced infrared sensors and leverages computer learnings to enhance performance and responsiveness.
Steven C. Blanco: While the supply chain continues to be volatile, we're working closely with our suppliers and remain confident in our path forward.
Steven C. Blanco: We continue to build out our detection portfolio with innovative new products and fixed gas and flame detection. We recently launched the F. O 5000, which has the latest advanced infrared sensors, and Leverages computer learnings to enhance performance and responsiveness.
Steven C. Blanco: This is an exciting addition to our flame detection lineup. In portable gas detection, we continue to see accelerating momentum with our IO4 Altair gas detector, which is now available in over 60 countries. As I wrap up, I want to highlight the resilience of our business, which continues to benefit from the broad diversity of our products, geographies, and markets. With attractive industry fundamentals, our proven innovation process, and leading positions in our markets, I'm excited about our future.
Steven C. Blanco: This is an exciting addition to our flame detection lineup.
Steven C. Blanco: In portable gas detection, we continue to see accelerating momentum with our Io for Altair gas detector, which is now available in over 60 countries.
Steven C. Blanco: As I wrap up I want to highlight the resiliency of our business, which continues to benefit from the broad diversity of our products geographies and markets.
Steven C. Blanco: With attractive industry fundamentals are proven innovation process and leading positions in our markets I'm excited by our future.
Steven C. Blanco: I believe we have the best team in the industry. And with our mindset around continuous improvement and our commitment to MBS, we're well positioned to create value over the long term for our stakeholders. Before wrapping up, I want to thank all of our MSA associates who work diligently every single day to deliver on our mission and serve our customers. With that, I'll now turn the call over to Lee to review our first quarter results and outlook. Thank you, Steve, and good morning everyone.
Steven C. Blanco: I believe we have the best team in the industry and with our mindset around continuous improvement and our commitment to M. D. S. We're well positioned to create value over the long term for our stakeholders.
Lee: Before wrapping up I want to thank all of our MSA Associates, who work diligently every single day to deliver on our mission and serve our customers with that I'll now turn the call over to lead to review, our first quarter results and outlook right.
Lee: Thank you, Steve and good morning, everyone.
Lee B. McChesney: We appreciate you joining us on the call today. I will now review our performance in the first quarter and provide an update on our full year outlook. Let's get started on slide six with quarterly results. Sales are $413 million, an increase of 4% over the prior year, with balanced contributions from volume and price. Currency Translation added a point to overall growth. Across our product categories, firefighter safety was a strong contributor to growth, up double digits, and was partially offset by declines in detection and industrial PPE.
Lee: Appreciate you joining the call today.
Lee B. McChesney: I will now review our performance in the first quarter and provide an update on our full year outlook.
Lee B. McChesney: Let's get started on slide six with quarterly results.
Lee B. McChesney: Sales were $413 million, an increase of 4% over the prior year with balanced contributions from volume and price.
Lee B. McChesney: Currency translation added a point to overall growth.
Lee B. McChesney: Across our product categories firefighter safety was a strong contributor to growth.
Lee B. McChesney: Up double digits and was partially offset by declines in detection in industrial P. P.
Lee B. McChesney: And from a regional perspective, sales in our more developed markets, including North America and EMEA, saw solid year-over-year growth, while sales in Latin America and APAC were soft, resulting from contractual timing with a customer in Latin America.
Lee B. McChesney: And from a regional perspective sales of our more developed markets, including North America, and EMEA saw solid year over year growth, while sales in Latin America, and APAC were softer, resulting from a contract renewal timing when a customer in Latin America, and a slower recovery in China.
Lee B. McChesney: Orders are healthy and acquisitive. Our order pace accelerated each month in the first quarter, and so far in April, orders are up high on single visits over the prior year. Commercial Pipeline is encouraging across our party categories. In the quarter, our book to bill was one time, backlog sequentially, specifically in detection and industrial PPE categories due to supply chain. We expect backlog to normalize by the end of the year. Now moving on to margins.
Lee B. McChesney: Orders were healthy in the quarter.
Lee B. McChesney: Our order pace accelerated each month in the first quarter and so far in April orders were up high single digits over the prior year.
Lee B. McChesney: In our commercial pipeline is encouraging across our product categories and the majority of our regions.
Lee B. McChesney: In the quarter, our book to Bill was one times backlog grew sequentially specifically in detection in industrial P. P categories due to supply chain issues, we expect backlog to normalize by the end of the year.
Lee B. McChesney: Now moving on to margins our margin performance continues to be a very robust and our team's commitment to MBS is clear from our results.
Lee B. McChesney: Our margin performance continues to be very robust, and our team's commitment to MBS is clear from our results. Gross profit margin in the quarter was 47.3%, up 180 basis points over the prior year. Operating margin on a gap basis was 19.4% in the quarter. Adjusted operating margin was 21.3%, up 190 basis points over the prior year, and Incremental Operating Margin was 71%. Margin expansion was largely driven by volume leverage, productivity, and price costs. Gas net income was $58 million, or $1.47 per diluted share.
Lee B. McChesney: Gross profit margin in the quarter was 47, 3% up 180 basis points over the prior year.
Lee B. McChesney: Operating margin on a GAAP basis was 19, 4% in the quarter adjusted operating margin was 21, 3% up a 190 basis points over the prior year and.
Lee B. McChesney: An incremental operating margin was 71%.
Lee B. McChesney: Margin expansion was largely driven by volume leverage productivity and price cost management.
Lee B. McChesney: GAAP net income was $58 million or $1 47 per diluted share.
Lee B. McChesney: On an adjusted basis, diluted earnings per share were $1.61, up 18% over the prior year. The increase is primarily due to higher operating profit and lower non-operating, Now moving on to our segment performance. In our Americas segment, sales increased 5% year over year, with double-digit growth in firefighter safety, partially offset by declines in detection. Industrial PPE.
Lee B. McChesney: On an adjusted basis diluted earnings per share were $1 61 up 18% over the prior year.
Lee B. McChesney: The increase was primarily due to higher operating profit and lower nonoperating expenses now moving onto our segment performance in our Americas segment sales increased 5% year over year with double digit growth in firefighter safety, partially offset by declines in detection and industrial P. P. Adjusted operating margin was.
Lee B. McChesney: Adjusted operating margin was 29.2%, or 360 basis points compared to the prior year period. Margin expansion was largely driven by volume leverage, productivity, and price. In our international segment, growth is flat. You're, Our immediate region delivered mid-single-digit growth, which was offset by declines in our APAC region, where we continue to see slower market conditions. Currency translation was a 1% benefit in the quarter. Adjusted operating margin was 11.5%, a decline of 190 basis points year-over-year, and margin was impacted by an unfavorable geographic mix and inflationary pressure.
Lee B. McChesney: 29, 2% of 360 basis points compared to the prior year period.
Lee B. McChesney: Margin expansion was largely driven by volume leverage productivity and pricing.
Lee B. McChesney: In our international segment growth was flat year over year.
Lee B. McChesney: Our EMEA region delivered mid single digit growth, which was offset by declines in our APAC region, where we continue to see slower market conditions in China.
Lee B. McChesney: Currency translation was a 1% benefit in the quarter.
Lee B. McChesney: Adjusted operating margin was 11, 5% a decline of 190 basis points year over year, our margin was impacted by unfavorable geographic mix and inflationary pressures.
Lee B. McChesney: Now turning to slide seven, pre-cash flow in the quarter was $40 million, representing a conversion rate of 62% of adjusted earnings. However, pre-cash flow conversion was impacted by normal working capital seasonality and tax incompetence.
Lee B. McChesney: Now turning to slide seven free.
Lee B. McChesney: Free cash flow in the quarter was $40 million, representing a conversion rate of 62% of adjusted earnings.
Lee B. McChesney: Free cash flow conversion was impacted by normal working capital seasonality and tax and compensation payments.
Lee B. McChesney: Our robust financial position and strong free cash flow generation provide us with the option to reinvest in our business and enhance our portfolio going forward by continuing to return excess capital to our shareholders. We invested $11 million in CapEx, including investments in our Morocco and Mexico facilities to improve efficiency. We also repaid $5 million of debt and returned $18 million in dividends to shareholders. Net debt at the end of the quarter was $448 million, and cash was $148 million.
Lee B. McChesney: Our robust financial position and strong free cash flow generation provides us optionality to reinvest in our business and enhance our portfolio going forward.
Lee B. McChesney: By continuing to return excess capital to our shareholders.
Lee B. McChesney: We invested $11 million in capex, including investments in Morocco, or Mexico facilities to improve efficiencies.
Lee B. McChesney: We also repaid $5 million of debt and returned $18 million in dividends to shareholders.
Lee B. McChesney: Net debt at the end of the quarter was $448 million in cash was $148 million.
Lee B. McChesney: Our net leverage ratio at quarter end was one time. Adjusted EBITDA for the trailing 12 months ended March 31st was $461 million, or 25.6% of net. Now I'd like to move on to our full year outlook on slide eight. While we are off to a solid start in 2024, we continue to take a very balanced approach as we look to the remainder of the year. The Resilient and Improving Orders trends throughout the quarter and a strong commercial pipeline support our four-year outlook.
Lee B. McChesney: Our net leverage ratio at quarter end was one times.
Lee B. McChesney: Adjusted EBITDA for the trailing 12 months ended March 31 was $461 million or 25, 6% of net sales.
Lee B. McChesney: Now I'd like to move on to our full year outlook on slide eight.
Lee B. McChesney: While we're off to a solid start in 2024, we continue to take a very balanced approach as we look to the remainder of the year.
Lee B. McChesney: The resilient and improving order trends throughout the quarter and a strong commercial pipeline and support our full year outlook.
Lee B. McChesney: We continue to carry some excess backlog and expect normalization will now occur by the end of the year. Broad diversification across products, geographic regions, and markets, along with the attractive underlying market trends in the safety industry, gives us confidence in executing our growth commitment this year. Empire View is a challenging operating environment in certain regions and industries.
Lee B. McChesney: We continue to carry some excess backlog and expect normalization will now occur by the end of the year.
Lee B. McChesney: Broad diversification across products geographic regions and markets, along with the attractive underlying market trends and the safety industry gives us the confidence in executing on our growth commitment this year.
Lee B. McChesney: Tempering, our view is the challenging operating environment in certain regions and industrial end markets.
Lee B. McChesney: As I look forward to full year 2024, we reiterate our sales outlook of mid-single-digit growth, which compounds on top of the 17% growth we delivered in 2023. We remain well-positioned and are steadfastly focused on delivering our financial commitments and creating sustainable value for our shareholders. On that note, we are energized to host our investor day in New York via webcast on May 22nd, where we will provide an in-depth review of our business, strategy, and financial results. And as I wrap up today, my final prepared marks are for Nishan.
Lee B. McChesney: As I look forward to full year 2024, we reiterate our sales outlook of mid single digit growth, which compounds on top of the 17% growth we delivered in 2023.
Lee B. McChesney: We remain well positioned and are steadfastly focused on delivering our financial commitments and creating sustainable value for our shareholders.
Lee B. McChesney: On that note, we are energized to host our Investor Day in New York via webcast on May 20.
Lee B. McChesney: We will provide an in depth review of our business strategy and financial objectives.
Lee B. McChesney: As I wrap up today my final prepared remarks, our furnish.
Lee B. McChesney: Congratulations to you as you conclude your management career at MSA. You've made a tremendous impact on our company, customers, and associates. Thank you.
Nishan: Congratulations to you as you conclude your management career at MSA.
Lee B. McChesney: Made a tremendous impact on our company customers and associates. Thank.
Nishan: Thank you.
Lee B. McChesney: I've appreciated your guidance, support, and partnership over the past two years. I wish you all the best in your retirement and look forward to our ongoing partnership with you serving on our Board of Directors. I will now turn the call back to Nish for his concluding remarks. Thank you, Lee.
Lee B. McChesney: I appreciate your guidance support and partnership over the past two years I wish you all the best in your retirement and look forward to our ongoing partnership with you serving on our board of directors.
Nish: I'll now turn the call back to niche for his concluding remarks.
Nish: Thank you Lee.
Nish: Let's advance to slide nine.
Nishan J. Vartanian: After 39 years at MSA and six years in the CEO role, my retirement comes after a very detailed succession planning process with our board. MSA continues to demonstrate excellent performance and has a strong foundation in place with our talent, innovation, and scale to continue advancing our mission and delivering strong results. I look forward to still being part of the MSA team as I continue to serve as a member of the company's board of directors.
Lee: After 39 years at MSA and six years in the CEO role My retirement comes after a very detailed succession planning process with our board.
Nishan J. Vartanian: <unk> continues to demonstrate excellent performance and has a strong foundation in place with our talent innovation and scale to continue advancing our mission and delivering strong results.
Nishan J. Vartanian: I look forward to still being part of the MSA team as they continue to serve as a member of the company's board of directors.
Nishan J. Vartanian: I'm tremendously thankful for the support of our associates, our board, and the investment community during my tenure as CEO. It has been an absolute privilege leading MSA, serving our customers, and developing MSA's next generation of leaders. I'm incredibly proud of our progress on accelerating innovation, growth, and margin performance. This has resulted in significant value creation for our stakeholders, and today, MSA is a high-performing, purpose-driven growth company. I've had the pleasure of working alongside Steve and this leadership team, and I'm confident in their ability to continue the strong momentum we've achieved together. I know MSA will be in excellent hands with Speed at the helm. And with that, I'll now turn the call back to the operator for questions.
Nishan J. Vartanian: I am tremendously thankful for the support of our associates, our board and the investment community during my tenure as CEO.
Nishan J. Vartanian: It has been an absolute privilege, leading NSA, serving our customers and developing Msas next generation of leaders.
Nishan J. Vartanian: Credibly proud of our progress on accelerating innovation growth and margin performance.
Nishan J. Vartanian: This has resulted in significant value creation for our stakeholders and today MSA as a high performance purpose driven growth company.
Nishan J. Vartanian: I've had the pleasure of working alongside C and this leadership team and I'm confident in their ability to continue the strong momentum we've achieved together.
Nishan J. Vartanian: I know MSA will be in excellent hands with feed at the helm.
Nishan J. Vartanian: And with that I'll now turn the call back to the operator for questions.
Operator: We will now begin the question and answer session. To ask a question, you may press star, then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the key. To withdraw your question, please press star, then 2. At this time, we will pause momentarily to assemble our roster. The first question is from Stanley Elliott with Stifle. Please go ahead.
Nishan J. Vartanian: We will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone.
Operator: If you are using a speakerphone. Please pick up your handset before pressing the keys to withdraw your question. Please press Star then two at this time, we will pause momentarily to assemble our roster.
Operator: The first question is from Stanley Elliott with Stifel. Please go ahead.
Stanley Stoker Elliott: Hey, good morning everyone. Congratulations on the nice start to the year.
Stanley Stoker Elliott: Hey, good morning, everyone. Congratulations on the nice start to the year.
unknown: Could you guys help us?
unknown: Can you guys help us maybe a little bit with the cadence? I mean, the mid-single digit seems very doable. You know, is there something kind of segment-wise you could point us to, kind of given how strong the fire piece was and maybe some of the supply chain issues you saw in some of the other businesses?
Stanley Stoker Elliott: Adam.
Stanley Stoker Elliott: Could you just help us maybe a little bit with the cadence I mean, the mid single digit seems very doable.
unknown: Is there something kind of segment wise, you could point us to kind of given how strong the fire piece was in and maybe some of the supply chain issues you saw on some of the other businesses.
Steven C. Blanco: Steve, why don't you take that? Yeah, good morning again, Stanley.
Speaker Change: People won't you take that yeah. Good morning, again Stanley. So if you look at it I guess I'd start with Q1, and we were pleased overall as we said in the prepared remarks with how the quarter went.
Steven C. Blanco: So if you look at it, I guess I'd start with Q1. And we were pleased overall, as we said in the prepared remarks, with how the quarter went. I think what's really nice for us is that month over month, it continued to get better from a demand perspective. And we know that the industrial markets are a little bit mixed, so that wasn't a surprise to us. And it probably will remain that way in the short cycle business.
Steven C. Blanco: I think what's really nice for us as we looked month over month, it continue to get better from a demand perspective.
Steven C. Blanco:
Steven C. Blanco: And we know that the industrial markets are a little bit of mix, so that wasn't a surprise to us.
Steven C. Blanco: And it probably will remain that way on the short cycle business. You know, we don't have as much visibility there but.
Steven C. Blanco: You know, we don't have as much visibility there, but where we do have visibility, which is the detection business and fire service, we feel really good. The fundamentals are good, and the pipeline is very solid. So that gives us some really good confidence as we look throughout the remainder of the year.
Steven C. Blanco: But where we do have visibility, which is the detection business and fire service. We feel really good you know it's the fundamentals are good and the pipeline is very solid so that gives us some really good confidence as we look throughout the remainder of the year.
Lee B. McChesney: And, you know, in terms of kind of international margins, certainly making a lot of nice progress here did take a bit of a step back. Sounds like it might have been mixed, but just curious kind of, you know, if that was the case, should we still think about this business? You, as a mid-teen sort of an EBITDA business or EBIT business or, you know, any color there, I guess would be great.
Steven C. Blanco: Yeah.
Steven C. Blanco: And in terms of kind of the international margins, certainly, making a lot of nice progress here did take a bit of a step down it sounds like it might've been mix, but just curious kind of if that was the case or should we still think about this business.
Lee B. McChesney: As a mid teens sort of an EBITDA or EBIT business or.
Lee B. McChesney: Any any color there I guess would be great.
Lee B. McChesney: Lee, why don't you take this? Yes, please. Stanley, I was expecting that question, so yeah. So, I mean, hey, growth's definitely a bit mixed, as Steve and I highlighted. You know, you have a situation where international growth is doing pretty well in Europe and the Middle East, but you do have a bit of a headwind in Asia, particularly in China. So, you know, that's what we've experienced in the last couple quarters. But as we look forward, you know, we still think some of those trends will continue.
Lee B. McChesney: Why don't you take that Stanley.
Lee B. McChesney: Expecting that question so yeah.
Lee B. McChesney: So hey growth definitely a bit mixed as Steve and I highlighted.
Lee B. McChesney: Have situation where international growth.
Lee B. McChesney: It was doing pretty well in Europe.
Lee B. McChesney: Middle East, but you do have a bit of a headwind in Asia, particularly with China. So that's what we've experienced the last couple of quarters.
Lee B. McChesney: But as we look forward, we still think some of those trends will continue but you do have a little bit of comps a difference as well. So we do think international will move into more of a mid single digit growth like we've talked about for the year.
Lee B. McChesney: But, you know, you do have a little bit of a comp difference as well, so we do think international will move into a bit more mid-singles growth like we've talked about for the year. You know, margins for the quarter are pressured because of some of the supply chain issues. We kind of grew in the lower margin portion of it, so that definitely affected it. And there was a little bit of some inflationary pressures as well.
Lee B. McChesney: You know margins for the quarter were pressured because of some of the supply chain issues. We kind of grew in the lower more lower margin portion of it so that definitely affected it and there was a little bit of a certain inflationary pressures as well.
Lee B. McChesney: So, as we look forward, I mean, international hasn't changed because of what happened in the first quarter here, coming out of the fourth quarter. We still think this is a, you know, mid-singles is a growth business. We've talked about, you know, we've progressed with margins. You know, you're going to see that step-up point you just saw in the first quarter. That naturally happens just because of the change in dollars running through the quarter.
Lee B. McChesney: As you look forward I mean.
Lee B. McChesney: The international hasn't changed because of what happened in the fourth quarter.
Lee B. McChesney: Corner here coming out of the fourth corner you still think this is a.
Lee B. McChesney: Mid single digit growth business, we've talked about progress with margins you know I think what you're.
Lee B. McChesney: Gonna see that step up from what you just saw in the first quarter that naturally happens just because of the change in dollars running through the quarter and then you know we have.
Lee B. McChesney: And then, you know, we have put a price increase in place. There's a good productivity deck in mind there. So, you know, it's more of the same. I mean, I will link it to international. I'll link it back to what Steve said. Our outlook for the year hasn't changed. You know, we have to manage a little bit of these supply chain things that hurt us, you know, later in the first quarter and cause a little bit of pain in the beginning of the second quarter here. But in the end, our outlook for the year is the same. Just maybe a little bit of subtle change in the first half of the year.
Lee B. McChesney: Nice increase in places are good productivity deck in mind there so.
Lee B. McChesney: It's more of the same.
Lee B. McChesney: I will make its international and then get back to what Steve said, our outlook for the year Hasnt changed.
Lee B. McChesney: Liberty's supply chain things that hurt us no later than the first quarter.
Lee B. McChesney: It caused a little bit of pain in the beginning of the second quarter here, but in the end of our outlook for the year is the same.
Lee B. McChesney: Maybe a little bit of a subtle change between the first half and second half.
Stanley Stoker Elliott: Perfect guys, thanks so much. And Nish, congratulations on your retirement and best wishes to you. And I look forward to seeing everybody here in a couple weeks. Thanks so much.
Speaker Change: Perfect guys. Thanks, so much and congratulations on your retirement and best wishes to you and I look forward to seeing everybody here in a couple of weeks. Thanks, So much I can say thanks Stanley.
Stanley Stoker Elliott: Yeah.
Operator: The next question is from Rob Mason with Baird. Please go ahead.
Stanley Stoker Elliott: The next question is from Rob Mason with Baird. Please go ahead.
Robert W. Mason: Yes, good morning, and I want to relay my congratulations to you, Nish, as well. It's a great run. And congratulations, Steve, also.
Robert W. Mason: Yes, good morning, and my congratulations to you niche as well so a great run and congratulations Steve also.
Robert W. Mason: Just maybe to go back to the order pace, you said it ticked up sequentially as you went through the quarter. I think at the last update, we were talking about mid-single digit growth in orders at that point. Is that basically where the order rate shook out for the quarter? Or I'm just curious, maybe what the comparisons look like, just on that front.
Robert W. Mason: Thanks, Rob.
Robert W. Mason: Maybe to go back to the the order pace.
Robert W. Mason: You said it.
Robert W. Mason: Ticked up as you sequentially as you went through the quarter I think at the last update we were talking about mid single digit growth in orders at that point.
Robert W. Mason: Is that basically where the order rate shook out for the quarter or I'm, just curious maybe what the comparisons look like.
Robert W. Mason: Just on that front.
Robert W. Mason: Betsy Yeah, I think we started off a little softer than that Rob and the first part of the quarter and then that accelerated throughout the quarter. So we ended up in a pretty good space space overall.
Steven C. Blanco: Yeah, I think we started off a little softer than that, Rob, in the first part of the quarter, and then that accelerated throughout the quarter. So we ended up in a pretty good space overall. Namely, you know, if we looked at the business, I'd say, I'd even parse it down regionally, you know, America's business accelerated a little faster than international, but the pipeline that international has and where the team is at, you know, and what they expect to start showing up this quarter and next quarter will come out even more clearly.
Steven C. Blanco: Mainly if we looked at the business I'd say I'd, even parse it down regionally the Americas business.
Steven C. Blanco: Accelerated a little faster than international.
Steven C. Blanco: But the pipeline that international has and what are the teams that you know and what they expect to start showing up into this quarter and next quarter, we'll come out even more clearly so it looks pretty good and it really April has turned out really nice. So just what we kind of expect it to have happened is it's kind of played out.
Steven C. Blanco: So it looks pretty good, and it really, April's turned out really nice. So just what we kind of expected to have happened has kind of played out. I would just probably, you know, again... The book-to-bill is a solid one, as we always say, don't overreact to any quarter. MS Word Doc Word Document.8, We've seen almost every week, you know, over the last, now, two, three months, there being a mid-single. MS WordDoc Word.
Steven C. Blanco: And I would just probably as you know again.
Steven C. Blanco: The book to bills are solid one as we always say don't overreact to any quarter right.
Steven C. Blanco: I think what we'll see something similar like that play out in the second quarter fourth quarter was a negative book to bill because that's what normally happens in the fourth quarter.
Steven C. Blanco: But to Steves point, you know orders have been in a good place you do we've seen almost every week.
Steven C. Blanco: You know over the last.
Steven C. Blanco: Two or three months to be in the mid single digit if not higher zone, you do run into some large comps as you go through the year. So for example in March of last year, we had a price increase announced for April and we also booked a large L. A so.
Steven C. Blanco: You guys navigate their daily business and then obviously you have some of these comps.
Steven C. Blanco: Document.8, 20% growth in the first quarter last year; I'll take that to your stack any day. Sure, sure. And then just, could you give a little more color around the supply chain challenges. I mean, are they still kind of the same things we've talked about in the past? Is it more components and chips related to the detection business? Or just, you know, a little feel for what you are actually dealing with at this point? Yeah, Rob.
Steven C. Blanco: We've said all year old will be our challenge. So we looked at the first quarter, 4% growth, 20% growth for the first quarter last year.
Speaker Change: Take that too your stack any day.
Rob: Sure sure and then just could you.
Speaker Change: Put a little more color around the supply chain challenges that means there's still kind of the same things we've talked about in the past is it more components.
Steven C. Blanco: Components and chips are related in the detection business or.
Rob: Just a little feel for what you actually are dealing with at this point.
Steven C. Blanco: Yeah, Rob Hey, first I'd say the supply chain is significantly better than over the past years that we've talked about so it's not the same level.
Steven C. Blanco: Hey, first, I'd say the supply chain is significantly better than the past years that we've talked about. So it's not the same level of challenge. This year was a little bit more around timing and the impact of that on the quarter, and you know, kind of rolling in the second quarter's lead reference, and it's twofold. We had a couple of challenges with fall protection and safety, and detection overall. We also had a problem earlier in the quarter with one of our sub suppliers for transportation, you know, trying to get things through the route around the world and through the Suez Canal.
Steven C. Blanco: A challenge.
Steven C. Blanco: This year was a little bit more around timing and the impact of that on the quarter and you know kind of rolling into the second quarter as Lee referenced and it's it's two fold. It we hit we had a couple of challenges in fall protection and and.
Steven C. Blanco: Overall, we also earlier in the quarter had a problem with one of our sub suppliers for transportation, you know trying to get things through.
Steven C. Blanco: The route around the world and get through the Suez Canal. So.
Steven C. Blanco: So that kind of backed them up. And with the domino effects, it took them a little while to get that cleaned up, which is now fine. So I mean, if you look at it, broadly speaking, it's similar to other industrials. The supply chain's a ton better, it's more consistent, but, as with others, we do have challenges every quarter. This time, it just happened to manifest itself in a way that showed up in our sales that we expected to pull through some more of that backlog in detection and industrial. So nothing though that alarms us or concerns us like the previous chip issues that you referenced from the past. Sure.
Steven C. Blanco: That kind of back them up and with the Domino effects. It took them a little while to get that cleaned up which is now fine.
Steven C. Blanco: I mean, if you look at it broadly speaking similar to other industrials.
Steven C. Blanco: You know the supply chain a ton better it's more consistent.
Steven C. Blanco: As with others, we do we do have challenges every quarter. This time. It just happened that manifests itself in a way that showed up with our sales that we expect it to pull through some more of that backlog in detection in industrial so nothing nothing though that that alarms us or concerns us like the previous chip issues.
Steven C. Blanco: You referenced from the past years.
Speaker Change: Sure and then just last for me.
Robert W. Mason: And then, just last for me, you talked about good visibility in the fire safety business. You concluded the first tranche, I guess, on the Air Force. Is there the expectation that there'll be more to ship on the Air Force this year built into the mid-single digit?
Robert W. Mason: You talked about good visibility in the fire.
Robert W. Mason: Our safety business.
Robert W. Mason: You.
Robert W. Mason: You concluded the first tranche I guess on the Air Force is is there the expectation that there'll be more to ship on Air Force This year.
Speaker Change: Built into the mid single digit guide and then maybe just a little bit of color also on the international front I know last quarter, Steve you seen.
Steven C. Blanco: Also on the international front, I know last quarter, Steve, you seemed to be optimistic on international FARC as well, shipping that in the first quarter to our customer. And we are expecting the second part, a second tranche of that, for that order to come in later this year. So we're working with the customer on what that timing might be.
Steven C. Blanco: To be optimistic on <unk>.
Steven C. Blanco: International fire as well right. So we're very pleased that we did finish that first tranche of the $35 million contract. We finished shipping that in the first quarter to our customer.
Steven C. Blanco: And we are expecting the second part of the second tranche of that for that order to come in later this year. So we're working with the customer on what that timing might be.
Steven C. Blanco: You know, internationally, we do, yeah, I am optimistic, very, you know, that team is very optimistic. We feel like we're competing very well with our customers across international markets. There are some nice large orders that are coming up soon. It's not dissimilar to the United States or Canada or LAR. Everywhere in the world, the one thing with fire, as you know Rob, it's a little lumpy, so orders or when the orders come in can, you know, vary somewhat, but the pipeline is really, really solid. So the international team, I think they're all over it, and I'm expecting to see that business continue to do well. Very good. Thank you.
Steven C. Blanco: Internationally.
Steven C. Blanco: We do yes.
Steven C. Blanco: I am optimistic the very you know that the team is very optimistic we feel like we're competing very well with our customers.
Steven C. Blanco: Cross the international markets. There's some nice large orders that come are coming up soon it's not dissimilar to the United States or Canada or L. A or everywhere in the world. The one thing with fire as you know Rob it's a little lumpy. So order when the orders come in can vary somewhat but.
Steven C. Blanco: The pipeline is really really solid so the international team I think they're all over it.
Steven C. Blanco: And I'm expecting to see that business continue to do well.
Speaker Change: Very good thank you.
Operator: The next question is from Ross Barenbeck with William Blair. Please go ahead.
Ross Riley Sparenblek: Our next question is from Ross sparing Black with William Blair. Please go ahead.
Ross Riley Sparenblek: Hey, just wanted to start on, you know, company level gross margins, and solid execution in the quarter. Are we right to assume that margins have found a new base here in the high 40s, just given the productivity efforts that have been put in place? And then maybe you could help us frame some of the moving pieces this year as you think about price, cost, mix, just trying to get a sense of the cadence of incrementals.
Ross Riley Sparenblek: Hey, good morning, gentlemen.
Speaker Change: Good morning.
Ross Riley Sparenblek: Hey, just wanted to start on company level gross margins solid execution in the quarter are we right to assume that margins are kind of kind of new base here and the high forties, just given the productivity efforts have been put in place and then can you also maybe help us frame. Some moving pieces. This year as you think about price cost mix, just trying to get a sense of the cadence of Incrementals.
Speaker Change: Don't forget that Lee there sure. So good question Ross So yeah, we we were certainly.
Lee B. McChesney: We were certainly delighted with the progress in margins in the first quarter. As you said, when we issued our outlook for the year, we gave commentary about 47 to 48 percent gross margin. Sustaining those levels, so certainly the first quarter, which is typically a little bit lower because of lower sales, to be where we're at, says we're certainly on a good pace. You know, it's still our mindset 47 to 48. It will step up with, you know, higher sales in the next several quarters. It can kind of work out the way it usually works out, the second and fourth will be the best, the third gets a little bit affected by the European holidays and things like that. So it's a good case.
Lee B. McChesney: Delighted with the progress in margins in the first quarter.
Lee B. McChesney: You said when.
Lee B. McChesney: When we issued our outlook for the year, we gave the commentary about 47%, 48% gross margin sustaining those levels. So certainly in the first quarter, which is typically a little bit lower because of lower sales to be where we're at says we're certainly on a good pace.
Lee B. McChesney:
Lee B. McChesney: That's still our mindset, 47% to 48.
Lee B. McChesney: It will step up with higher sales in the next several quarters it kind of a kind of away from she works out to the second and fourth will be the best third just a little bit affected by the European holidays and things like that.
Lee B. McChesney: <unk>.
Lee B. McChesney: Now, what's behind that is really all elements of MBS. So things like NPD that we highlighted in the prepared remarks, certainly we're going after productivity on a sustained basis that we've talked about for the last several years. I really have a robust deck.
Lee B. McChesney: So it's a good pace now what's behind that is really all elements of of MBS. So.
Lee B. McChesney: Things like NPD that we highlighted in our prepared remarks, certainly we're going after productivity on a sustained basis that we've talked about for the last several years I really have a robust deck.
Lee B. McChesney: Again, both nice catalysts in the first quarter alone, we expect that to continue. And then, you know, price. And inflation, we'll kind of balance each other out. We still have inflation. We just don't have the levels of inflation before. It's moderated. The U.S. has our price as well.
Lee B. McChesney: Nice catalyst in the first quarter alone, we expect that to continue and then price.
Lee B. McChesney: And inflation it will kind of balance themselves out we still have inflation. We just don't have the levels of inflation before it's moderated and you're as has our price as well. So we're trying to keep those in balance and then but all the other elements of MBS kind of come through we need to protect margins or.
Lee B. McChesney: So we're trying to keep those in balance and then let all the other elements of MBS kind of come through. We need to protect margins or, actually, give us an opportunity to expand them over time. But that's our mindset for this year, and that should put us in a good place. It all ties back to, I'll use this option to say that our outlook for the year is the same as in February. You have mid single-digit growth, 30 to 40 percent incrementals, and then free cash flow of 90 to 100 percent. Nothing's changed. Everything is, frankly, just confirmed coming out of the first quarter.
Lee B. McChesney: Can you give us an opportunity to expand them over time, but that's our mindset.
Lee B. McChesney: For this year and that should put us in a good place.
Lee B. McChesney: <unk> back to I'll use this opportunity to say that our outlook for the year is the same as in February mid single digit growth, 30% to 40% Incrementals and then free cash flow of 90% to 100% Nothing's changed everything frankly, just confirm coming out of the first quarter.
Ross Riley Sparenblek: No, that's helpful. And maybe just putting a finer point on the new products. Can you give us a sense of what, you know, early demand trends have been for the 1836? And then also any other launches on the horizon that we should just remain cognizant of? [inaudible]
Lee B. McChesney: Yeah.
Speaker Change: No no that's helpful.
Lee B. McChesney: And then maybe just putting a finer point on the new products can you give us a sense of what early demand trends have been for the 18 to 36 and then also any other launches on the horizon that we should just remain cognizant of.
Steven C. Blanco: So Ross, you're talking about 1836. Tremendous response. That's a new helmet in a market that was really, you know, we spent a lot of time listening to the voice of the customer in that market and quite a long time making sure we developed something that hit the mark, and this one seems to really have hit the mark. It's coming out of the gate very strongly, you know, and it's hitting some key competitive needs that that market has about comfort and balance as well as the weight of that So we're really excited by how the customers are responding so far.
Ross Riley Sparenblek: Okay.
Ross Riley Sparenblek: So where else you're talking about the 18 36 tremendous response.
Steven C. Blanco: That's a new helmet and a market that was really we spent a lot of time with voice of customer with that market.
Steven C. Blanco: And quite a quite a long time, making sure we develop something that hit the Mark and this one seems to really have hit the markets coming out of the gate very strongly.
Steven C. Blanco: And it's it's hitting some key competitive needs that that market has about comfort in balance.
Steven C. Blanco: As well as the weight of that helmet. So we're really excited by how the customers responded so far.
Steven C. Blanco: And then, I mean, just anything else that we should, you know, keep note of. Is there anything we can do in 2024? Yeah, good question, Russ.
Speaker Change: And then I mean, just anything else that we should not yeah.
Speaker Change: <unk> no doubt.
Speaker Change: As we mentioned in 'twenty 'twenty four is well when referenced yes. Good question Ross, we weren't where we referenced the <unk> 5000, which is N and I are it's an ultra violent infrared flame detector that we launch it replaces our F. L 4000.
Steven C. Blanco: We referenced the FL5000, which is an IR; it's an ultraviolet infrared flame detector that we launched. It replaces our FL4000. This is another one that we think is going to be a big game changer in the market. It's got a lot of really cool features. Much improved performance, reducing false alarms for our customers. It's performance-certified for 22 flammable fuel sources, which is a really big deal. And I would also share, you know, we talked about this on past calls, but this is a really great type of technology for hydrogen.
Steven C. Blanco: This is another one that we think is going to be a big game changer in the market. You know it's got a lot a lot of really cool features on it much improved performance, reducing false alarms for our customers. It's performance certified for 'twenty, two flammable fuel sources, which is a really big deal and I would also share you always talk.
Steven C. Blanco: About this on past calls, but this is a really good.
Steven C. Blanco: So, you know, we look at this product as a nice lead-in across all the energy markets, including renewable energy. That's great. All right, well, I just want to say congratulations, Nish, on the retirement, and Steve, we're looking forward to working with you. I know your guys have been here for investor days and a couple weeks here, but maybe, Steve, you could give us an early read on how you're thinking about the business, any areas of opportunity or low-hanging items that you think could be addressed early on.
Steven C. Blanco: Great type of technology for hydrogen so we look at this product as a nice lead in across all of the energy markets, including renewable.
Steven C. Blanco: Yeah.
Speaker Change: That's great.
Steven C. Blanco: Alright, well I just want to say congratulations on the retirement and Steve. We're looking forward to working with you I know you guys at the Investor days, a couple of weeks here, but maybe Steve if you could give us an early read on how youre thinking about the business any areas of opportunity are well hanging items that you think can be addressed early on.
Steve: Yeah, Thanks for Us and first I've got big Big shoes to fill.
Steven C. Blanco: Thanks Ross. First, I've got big shoes to fill. I think a size 38 is what I should be wearing.
Steve: I think slide 38.
Steven C. Blanco: But I joined the company 12 years ago because we are purpose-driven, and, like all of our associates, I'm passionate about our mission, and it really is about how we serve that mission through our customers, and they will remain and have been the center of everything we do. So, you know, what we said in prepared remarks around Leveraging our scale and our brand are front and center for me personally and the leadership team.
Steve: But I joined the company 12 years ago, because of us being purpose driven and.
Steven C. Blanco: Like all of our associates I'm passionate about our mission and it really is about how we serve that mission through our customers and they'll remain and have been the center of everything we do so what we said in our prepared remarks around.
Steven C. Blanco: Leveraging our scale and our brand are front and center for me personally and the leadership team.
Steven C. Blanco: What I think is exciting is we'll talk more about it at Investor Day, and that's because we spent a lot of time really evaluating our strategy, looking at what we've done well and what we think we can improve on. So the team's really excited to share that at Investor Day and talk about where we imagine the future to be and how we're going to execute that strategy with our business. So that'd be kind of my early opener to make sure that people are there for investors. Yeah, absolutely. We're looking forward to it.
Steven C. Blanco: What I think is exciting as we will talk more about it in Investor day, and that's we spend a lot of time really evaluating our strategy and looking at what we've done well and what we think we can improve on.
Steven C. Blanco: The team is really excited to share that at Investor day, and talk about where we envision the future to be and how we're going to execute that strategy with our business system.
Steven C. Blanco: That would be kind of my early opener to make sure that people are there for investor day.
Speaker Change: Yeah, absolutely we're looking forward to it we've got good guys.
Ross Riley Sparenblek: Yeah, absolutely. We're looking forward to it. Congratulations again, guys.
Speaker Change: Thank you. Thank you.
Ross Riley Sparenblek: This concludes our question and answer session I would like to turn the conference back over to Chris <unk> for any closing remarks.
Chris Hepler: This concludes our question and answer session. I would like to turn the conference back over to Chris Hepler for any closing remarks.
Chris Hepler: Thank you, Debbie. We appreciate you joining the call this morning and for your continued interest in MSA Safety. To learn more about our purpose-driven culture, unique innovation engine, and differentiated strategy, please join our Investor Day webcast on May 22nd. And if you missed a portion of today's call, an audio replay will be made available later today on our Investor Relations website and will be available for the next 90 days. We look forward to updating you again on our continued progress next quarter. Thank you.
Chris Hepler: Thank you Debbie we appreciate you joining the call. This morning and for your continued interest in MSA safety to learn more about our purpose driven culture unique innovation engine and differentiated strategy. Please please join our Investor day webcast on May 20 <unk>.
Chris Hepler: And if you Miss the portion of today's call an audio replay will be made available later today on our Investor Relations website and will be available for the next 90 days, we look forward to updating you again on our continued progress next quarter. Thank you.
Chris Hepler: Okay.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.