Q2 2026 ITT Inc Earnings Call

August 6, 2026

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Speaker #2: It is now my pleasure to turn the floor over to Carleen Salvage, Vice President, Investor Relations and FP&A. You may begin.

Speaker #3: Thank you, Liz, and good morning. Joining me in Stanford today are Luca Savi, ITT's Chief Executive Officer and President, and Mike Savanelli, Interim Chief Financial Officer.

Carleen Salvage: Thank you, Liz, and good morning. Joining me in Stamford today are Luca Savi, ITT's Chief Executive Officer and President, and Mike Savinelli, Interim Chief Financial Officer. Today's call will cover ITT's financial results for the three-month period ended 4 July 2026, which we announced this morning. Please refer to slide two of the presentation available on our website, where we note that today's comments will include forward-looking statements that are based on our current expectations. Actual results may differ materially due to several risks and uncertainties, including those described in our 2025 annual report on Form 10-K and other recent SEC filings. Except where otherwise noted, the Q2 results we present this morning will be compared to the Q2 2025 and include certain non-GAAP financial measures.

Speaker #3: Today's call will cover ITT's financial results for the three-period, three-month period ended July 4, 2026, which we announced this morning. Please refer to slide 2 of the presentation available on our website, where we note that today's comments will include forward-looking statements that are based on our current expectations.

Speaker #3: Actual results may differ materially due to several risk and uncertainties, including those described in our 2025 annual report on Form 10-K and other recent SEC filings.

Speaker #3: Except where otherwise noted, the Q2 results we present this morning will be compared to the Q2 of 2025 and include certain non-GAAP financial measures.

Speaker #3: The reconciliation of such measures to the most comparable GAAP figures are detailed in our press release and in the appendix of our presentation both of which are available on our website.

Carleen Salvage: The reconciliation of such measures to the most comparable GAAP figures are detailed in our press release and in the appendix of our presentation, both of which are available on our website. Today's earnings call includes year-over-year commentary on the performance of SPX FLOW that reflects financial information before the acquisition date of 2 March 2026. With that, it is now my pleasure to turn the call over to Luca, who will begin on slide three.

Speaker #3: Today's earnings call includes year-over-year commentary on the performance of SPX Flow that reflects financial information before the acquisition date of March 2, 2026. With that, it is now my pleasure to turn the call over to Luca, who will begin on slide 3.

Speaker #4: Thank you, Carleen, and good morning. Before I begin, I would like to welcome our new aerospace contacts colleagues to the ITT family. I look forward to working with you to grow CCT more and faster.

Luca Savi: Thank you, Carlene, and good morning. Before I begin, I would like to welcome our new Aerospace Controls colleagues to the ITT family. I look forward to working with you to grow CCT more and faster. We would also like to recognize our ITTers all around the world for an outstanding performance in Q2 once again. A particular thank you to our employees in Flow Technologies for their hard work that has enabled us to make significant progress on the integration of SPX FLOW whilst continuing to deliver strong operational and financial performance. In the Q2, we accelerated the Q1 momentum. Our ITT has delivered strong performance across the portfolio through flawless execution and the realization of benefits from our acquisitions, building a solid foundation for the remainder of 2026 and beyond. Now to the momentum. We grew orders 53%, 13% organically.

Luca Savi: Thank you, Carlene, and good morning. Before I begin, I would like to welcome our new Aerospace Controls colleagues to the ITT family. I look forward to working with you to grow CCT more and faster. We would also like to recognize our ideas all around the world for an outstanding performance in Q2 once again. A particular thank you to our employees in Flow Technologies for their hard work that has enabled us to make significant progress on the integration of SPX FLOW whilst continuing to deliver strong operational and financial performance. In the Q2, we accelerated the Q1 momentum. Our ITT has delivered strong performance across the portfolio through flawless execution and the realization of benefits from our acquisitions, building a solid foundation for the remainder of 2026 and beyond. Now to the momentum. We grew orders 53%, 13% organically.

Speaker #4: We will also like to recognize our ITTers all around the world for an outstanding performance in Q2, once again. And a particular thank you to our employees in flow technologies for their hard work that has enabled us to make significant progress on the integration of SPX Flow, whilst continuing to deliver strong operational and financial performance.

Speaker #4: In the Q2, we accelerated the Q1 momentum, our ITTers delivered strong performance across the portfolio through flawless execution and the realization of benefits from our acquisitions.

Speaker #4: Building a solid foundation for the remainder of 2026 and beyond. Now to the momentum. We grew orders 53%, 13% organically. We grew revenue 51%, 13% organically, reflecting a boot-to-bear of $1.1 for the quarter.

Luca Savi: We grew revenue 51%, 13% organically, reflecting a book-to-bill of 1.1 for the quarter. We expanded operating margin 40 basis points. We delivered adjusted EPS of $2.08, up 18% year over year. We generated $176 million of free cash flow year to date. A truly record quarter. Let's dive now into the details. On orders, CCT was the highlight of our Q2 performance, growing 59% organically. CCT's growth was fueled by large defense orders in our kSARIA business, which posted significant multi-year bookings across mission-critical platforms such as advanced night vision applications and fighter jet programs. kSARIA grew orders 168%, It didn't end there. We continue to see strength in early Q3 with record order bookings in July. The Connectors business also posted record orders, increasing 38%, fueled by growth in North America, Europe, and Asia.

Luca Savi: We grew revenue 51%, 13% organically, reflecting a book-to-bill of 1.1 for the quarter. We expanded operating margin 40 basis points. We delivered adjusted EPS of $2.08, up 18% year over-year. We generated $176 million of free cash flow year to date. A truly record quarter. Let's dive now into the details. On orders, CCT was the highlight of our Q2 performance, growing 59% organically. CCT's growth was fueled by large defense orders in our kSARIA business, which posted significant multi-year bookings across mission-critical platforms such as advanced night vision applications and fighter jet programs. kSARIA grew orders 168%, It didn't end there. We continue to see strength in early Q3 with record order bookings in July. The Connectors business also posted record orders, increasing 38%, fueled by growth in North America, Europe, and Asia.

Speaker #4: We expanded operating margin 40 basis points. We delivered adjusted EPS of $2.08, up 18% year-over-year. And we generated $176 million of free cash flow year-to-date.

Speaker #4: A truly record quarter. Let's dive now into the details. On orders, CCT was the highlight of our Q2 performance, growing 59% organically. CCT's growth was fueled by large defense orders in our Kessaria business.

Speaker #4: Which posted significant multi-year bookings across mission-critical platforms, such as advanced night vision applications and fighter jet programs. Kessaria grew orders 168%, and it didn't end there.

Speaker #4: We continued to see strength in early Q3, with record order bookings in July. The connectors business also posted record orders, increasing 38%, fueled by growth in North America, Europe, and Asia.

Speaker #4: Motion Technologies continued to win-win platform and conquer new awards in Friction, feeding future market share gains. Coney orders were also strong, with 9% growth, thanks mainly to China Rail and Defense.

Luca Savi: Motion Technologies continued to win with platform and conquer new awards in friction, feeding future market share gains. KONI orders were also strong, with 9% growth, thanks mainly to China Railway and Defense. Lastly, in Flow Technologies, we delivered 91% orders growth. Organic orders declined 3% year over year due to the impact of deferred orders in the Middle East and the strong prior year performance that included very large oil and gas orders. SPX FLOW grew orders 9% in Q2 versus their prior year numbers, 23% growth in mixers across North America and China, 10% growth in Waukesha Cherry-Burrell, and 8% growth in Nutrition and Health, supported by strong systems orders in Europe. On revenue, this quarter's performance was fueled by organic growth across all our segments. CCT grew 17% organically, driven by strength across the portfolio. Commercial Aerospace grew 14% from increased volume coupled with pricing benefits.

Speaker #4: And lastly, in flow technologies, we delivered 91% orders growth. Organic orders declined 3% year-over-year due to the impact of the third orders in the Middle East and the strong prior year performance that included very large oil and gas orders.

Speaker #4: SPX Flow grew orders 9% in Q2 versus their prior year numbers, 23% growth in mixers across North America and China, 10% growth in Waukesha cherry barrel, and 8% growth in nutrition and health, supported by strong systems orders in Europe.

Speaker #4: On revenue, this quarter's performance was fueled by organic growth across all our segments. CCT grew 17% organically, driven by strength across the portfolio. Commercial aerospace grew 14% from increased volume coupled with pricing benefits.

Luca Savi: Defense grew 16%, driven by strong performance in kSARIA, which grew 28% versus the prior year. We also grew Industrial Connectors 24%, led mainly by Europe and Asia. Motion Technologies revenue increased 6%, 2% organic, led by friction aftermarket and outperformance of global vehicle production by more than 300 basis points, led by Europe and China, in addition to strength in China Railway. Finally, Flow Technologies revenue was up 21% organically or 123% in total. The teams continues to deliver higher pump project sales, up 45%, driven by shipments in marine energy transition and oil and gas markets. We also continue to grow our valves business up 19% as we keep on winning in biopharma. Well done, Kasturi and the Lancaster team. SPX FLOW revenue grew 5% in Q2 and 9% year to date, in line with our full year guidance of high single-digit growth.

Speaker #4: Defense grew 16%, driven by strong performance in Kessaria, which grew 28% versus the prior year. We also grew industrial connectors 24%, led mainly by Europe and Asia.

Speaker #4: Motion Technologies revenue increased 6%,

Speaker #1: 2% organic , led by friction after market and outperformance of global vehicle production by more than 300 basis points , led by Europe and China In addition to strength in China , rail and finally flow Technologies , revenue was up 21% organically or 123% .

Speaker #1: In total The team continues to deliver higher pump product sales , up 45% , driven by shipments in marine energy transition and oil and gas markets , and we also continue to grow our vast business Up 19% as we keep on winning biopharma .

Speaker #1: Well done Kasturi . And the Lancaster team ESP flow revenue grew 5% in Q2 and 9% year to date . In line with our full year guidance of high single digit growth on operating margin margin expanded 100 basis points over the prior year , and 240 basis points sequentially to 21.7% , primarily from higher volume and pricing .

Luca Savi: On operating margin, CCT's margin expanded 100 basis points over the prior year and 240 basis points sequentially to 21.7%, primarily from higher volume and pricing. Motion Technologies margin of 21.1 grew 90 basis points as a result of net productivity. Flow Technology, excluding SPX FLOW, expanded margin 70 basis points, fueled by market share gains and pricing. Total Flow margin of 21.4% was diluted by the full quarter contribution of SPX FLOW. Nevertheless, cost synergies from the integration, together with other productivity actions in the H2 of the year, are expected to expand margins throughout the remainder of 2026. As a result of our outstanding operational execution, we deliver adjusted EPS of $2.08, up 18% versus the prior year. Turning now to capital allocation.

Speaker #1: Motion technologies margin of 21.1 grew 90 basis points as a result of net productivity inflow technology . Excluding ESP flow , expanded margin 70 basis points fueled by market share gains and pricing .

Speaker #1: Total flow margin of 21.4% was diluted by the full quarter . Contribution of ESP flow Nevertheless , cost synergies from the integration together with other productivity actions in the second half of the year are expected to expand margins throughout the remainder of 2026 .

Speaker #1: As a result of our outstanding operational execution , we delivered adjusted EPS of $2.08 , up 18% versus the prior year Turning now to capital allocation previously shared , we're prioritizing that repayment .

Luca Savi: As previously shared, we're prioritizing debt repayment, and in Q2, we paid down $124 million, bringing our leverage ratio to 2.5 times, 6 months ahead of our original commitment. In July, we also deployed capital to acquire Aerospace Controls. Though small, this acquisition is highly strategic to enhance our supply chain resilience, secure supply of critical high-precision contacts, and in doing so, support continued growth with our Connectors defense and aerospace customers. As you see, our legacy businesses are firing on all cylinders and now are also taking advantage of some market tailwinds. As we shared during our Capital Markets Day, we are compounding and creating more value with our recent acquisitions. Let's turn to slide four to discuss these contributions. During the last few years, we worked hard to cultivate and execute the right acquisitions. We focus on high-quality companies with strong management teams and solid fundamentals.

Speaker #1: And in Q2 , we paid down $124 million , bringing our leverage ratio to 2.5 times . Six months ahead of our original commitment in July , we also deployed capital to acquire aerospace contacts Those more .

Speaker #1: This acquisition is highly strategic to enhance our supply chain resilience , secure supply of critical , high precision contacts , and in doing so , support continued growth with our connectors .

Speaker #1: Defense and aerospace customers As you see , our legacy businesses are firing on all cylinders . And now are also taking advantage of some market tailwinds And as we shared during our capital Markets Day , we are compounding and creating more value with our recent acquisitions Let's turn to slide four to discuss this .

Speaker #1: Contributions During the last few years , we worked hard to cultivate and execute the right acquisitions We focus on high quality companies with strong management teams and solid fundamentals This acquisitions do more than at scale They strengthen its portfolio by increasing our exposure to higher growth , higher margin businesses where we can drive additional value through differentiation in execution and innovation This is exactly the playbook we whom .

Luca Savi: These acquisitions do more than add scale. They strengthen ITT's portfolio by increasing our exposure to higher growth, higher margin businesses, where we can drive additional value through differentiation in execution and innovation. This is exactly the playbook with Svanehøj. We enter the marine energy transition market, a market that has a lot of growth potential today with LNG and in the future with ammonia. Svanehøj's products and team are leaders in their market, and the results speak for themselves. Since acquisition through the end of 2026, Svanehøj is expected to grow revenue 32% on average each year with a book-to-bill of 1.2. Our projected backlog at the end of 2026 will be up 40% since the acquisition. As a result, the acquisition multiple of 13 is projected to be just six at the end of 2026. Thank you, Soren, Morten, and Johnny, for this excellent performance.

Speaker #1: We entered the Marine energy transition market , a market that has a lot of growth potential . Today with LNG . And in the future with ammonia products and team are leaders in their market .

Speaker #1: And the results speak for themselves Since acquisition through the end of 2026 , Silvano is expected to grow revenue 32% on average each year , with a book to bill of 1.2 .

Speaker #1: Our projected backlog at the end of 2026 will be up 40% since the acquisition . As a result , the acquisition multiple of 13 is projected to be just six at the end of 2026 .

Speaker #1: Thank you Zoran Morton and Johnny for this excellent performance . And the Marine Energy transition and market expected to remain strong is well positioned for future profitable growth .

Luca Savi: The marine energy transition end market is expected to remain strong. Svanehøj is well positioned for future profitable growth. kSARIA, another bolt-on acquisition, is also a success story. The defense market, which represents roughly 80% of kSARIA, provides a powerful market tailwind. kSARIA's leadership and flawless execution enable us to win larger portions of the prime programs we participate in. By the end of 2026, we're projecting to grow backlog 180% since acquisition and orders 60% on average each year. This positions us incredibly well for the future. kSARIA's acquisition multiple of 13 is expected to be 11 by the end of 2026, and we still have plenty of opportunities to expand margins with pricing actions and productivity initiatives. Thanks, Madi Porta and team, for the quarter results.

Speaker #1: Kesaria another bolt on acquisition is also a success story . The defense market , which represents roughly 80% of Caesarea , provides a powerful market tailwind .

Speaker #1: Kisara's leadership and flawless execution enable us to participate in larger portions of the prime programs we are involved in. By the end of 2026, we are projecting to grow our backlog by 180%.

Speaker #1: Since the acquisition and orders 60% on average each year This positions us incredibly well for the future . Kisara's acquisition multiple of 13 is expected to be 11 by the end of 2026 , and we still have plenty of opportunities to expand margins with pricing actions and productivity initiatives Thanks .

Speaker #1: My depot team for the quarter of results on ESP We are in the early innings , but we are encouraged by how we started the progress we have made and the future potential on the start .

Luca Savi: On SPX, we are in the early innings, but we are encouraged by how we started, the progress we have made, and the future potential. On the start, we are ahead of our plan, and the team is working hard to accelerate. We are on the path to our high single-digit growth commitment with orders in H1 of the year growing 7% and revenue growing 9% year-to-date resulted in a book-to-bill of 1.05. We are progressing well and cost synergies are ahead of plan while we're working hard to be the strong foundation for future revenue synergies. On future potential, we have plenty of growth prospects in each business, be it Nutrition and Health, Waukesha Cherry-Burrell, mixers, or pumps, and the funnel of opportunities keeps on growing.

Speaker #1: We are ahead of our plan and the team is working hard to accelerate We have a path to our high single digit growth commitment with orders in the first half of the year growing 7% and revenue growing 9% year to date , resulted in a book to bill of 1.05 .

Speaker #1: We are progressing well and cost synergies are ahead of plan . While we are working hard to build a strong foundation for future revenue synergies on future potential , we have plenty of growth prospects in each business , be it nutrition and health .

Speaker #1: Wakisha Cherry Burrell mixers or pumps , and the final of opportunities keeps on growing . I'm encouraged by what I experienced at Seta is more factory and business in Italy .

Luca Savi: I'm encouraged by what I experienced at Settala, a small factory and business in Italy that is part of Nutrition and Health. I was fortunate to spend time with the local management, learn from their deep knowledge of the commercial and engineering teams, and observe the 5S of the well-run plant. This is a team that is ready to win and conquer more. Another site with great potential is our Xidu factory in China. We spent time with Bruce Wang and the local team exploring how we can grow faster and more profitably in APAC and China by adopting a more entrepreneurial mindset, an undeterred continuous improvement approach, and continuing to invest in innovation. As you can see, our acquisition playbook is indeed working.

Speaker #1: That is part of health . I was fortunate to spend time with the local management , learn from their deep knowledge of the commercial and engineering teams , and observe the five s of the well-run plant This is a team that is ready to win and conquer more .

Speaker #1: Another side with great potential is our new factory in China . We spent time with Bruce Wang and the local team , exploring how we can grow faster and more profitably in APAC and China by adopting a more entrepreneurial mindset .

Speaker #1: And undeterred , continuous improvement approach and continuing to invest in innovation . As you can see , our acquisition playbook is indeed working .

Speaker #1: In summary, our legacy businesses will keep delivering value through above-market growth and continuous margin expansion, while acquisitions will compound value by doing exactly the same.

Luca Savi: In summary, our legacy businesses will keep delivering value through above-market growth and continuous margin expansion, whilst acquisitions will compound value by doing exactly the same. With that, let me now turn the call over to Mike Savinelli, who's joining us for his first earnings call to discuss Q2 results in detail on slide five.

Speaker #1: With that , let me now turn the call over to my Savinelli , who's joining us for his first earnings call to discuss Q2 results in detail on slide five .

Speaker #2: Thank you , Luca , and good morning . As Luca highlighted , we delivered a very strong quarter in Q2 . We achieved outstanding growth across the business in revenue adjusted margin , EPS , and cash .

Michael J. Savinelli: Thank you, Luca, and good morning. As Luca highlighted, we delivered a very strong quarter. In Q2, we achieved outstanding growth across the business in revenue, adjusted margin, EPS, and cash. Our teams delivered a record $1.5 billion in revenue, growing 51% or 13% organically. CCT grew 17% organically, fueled by industrial connectors and aerospace and defense strength. CCT ended the quarter with a robust book-to-bill of 1.4. Motion Technologies grew 2% organically, a significant achievement in a down market, driven by friction aftermarket and OE outperformance together with KONI growth. Finally, Flow Technologies grew 21% organically, driven by strong project shipments and from strength in short cycle, which was up 10% year-over-year.

Mike Savinelli: Thank you, Luca, and good morning. As Luca highlighted, we delivered a very strong quarter. In Q2, we achieved outstanding growth across the business in revenue, adjusted margin, EPS, and cash. Our teams delivered a record $1.5 billion in revenue, growing 51% or 13% organically. CCT grew 17% organically, fueled by industrial connectors and aerospace and defense strength. CCT ended the quarter with a robust book-to-bill of 1.4. Motion Technologies grew 2% organically, a significant achievement in a down market, driven by friction aftermarket and OE outperformance together with KONI growth. Finally, Flow Technologies grew 21% organically, driven by strong project shipments and from strength in short cycle, which was up 10% year-over-year.

Speaker #2: Our teams delivered a record $1.5 billion in revenue , growing 51% or 13% organically c grew 17% organically , fueled by industrial connectors and aerospace and defense strength Cty ended the quarter with a robust book to bill of 1.4 Motion technologies grew 2% organically , a significant achievement in the down market .

Speaker #2: Driven by friction , aftermarket and OE outperformance . Together with Coni growth . And finally , flow technologies grew 21% organically , driven by strong project shipments and from strength .

Speaker #2: In short cycle , which was up 10% year over year . Our strong top line performance contributed to operating income growth of 55% and margin expansion of 40 basis points supported further by the full quarter of SBX flow , as well as strong execution across our legacy businesses .

Michael J. Savinelli: Our strong top-line performance contributed to operating income growth of 55% and margin expansion of 40 basis points, supported further by the full quarter of SPX FLOW, as well as strong execution across our legacy businesses. CCT delivered 23% operating income growth to a margin of 21.7%, a 100 basis point expansion driven by increased volume, realization of pricing actions, and productivity, partially offset by material inflation. Flow Technologies delivered a margin of 21.4%, a decline of 160 basis points driven by the full quarter impact of SPX FLOW. We expect to expand margin sequentially throughout the year from cost synergy realization and other productivity initiatives. MT's operating margin grew 90 basis points to 21.1% as the team drove net productivity of 110 basis points over the prior year.

Mike Savinelli: Our strong top-line performance contributed to operating income growth of 55% and margin expansion of 40 basis points, supported further by the full quarter of SPX FLOW, as well as strong execution across our legacy businesses. CCT delivered 23% operating income growth to a margin of 21.7%, a 100 basis point expansion driven by increased volume, realization of pricing actions, and productivity, partially offset by material inflation. Flow Technologies delivered a margin of 21.4%, a decline of 160 basis points driven by the full quarter impact of SPX FLOW. We expect to expand margin sequentially throughout the year from cost synergy realization and other productivity initiatives. MT's operating margin grew 90 basis points to 21.1% as the team drove net productivity of 110 basis points over the prior year.

Speaker #2: KT delivered 23% operating income growth to a margin of 21.7% , a 100 basis point expansion driven by increased volume realization , realization of pricing actions , and productivity , partially offset by material inflation .

Speaker #2: Flow technology has delivered a margin of 21.4% , a decline of 160 basis points , driven by the full quarter impact of SPX flow We expect to expand margin sequentially throughout the year from cost synergy , realization and other productivity initiatives , and Mt's operating margin grew 90 basis points to 21.1% as the team drove net productivity of 110 basis points over the prior year .

Speaker #2: As a result of our top line performance in March and expansion , EPS reached $2.08 for the quarter , increasing 18% versus the prior year Lastly , year to date free cash flow of $176 million was impacted by $71 million of one time acquisition related expenses , which we highlighted in Q1 .

Michael J. Savinelli: As a result of our top-line performance and margin expansion, EPS reached $2.08 for the quarter, increasing 18% versus the prior year. Lastly, year-to-date free cash flow of $176 million was impacted by $71 million of one-time acquisition-related expenses, which we highlighted in Q1. Excluding these impacts, free cash flow was up 15% year over year, and looking purely at Q2, our free cash flow margin was 11% for the quarter. Let's now turn to the Q2 EPS bridge on Slide six. The 18% EPS growth was primarily driven by strong operational performance delivered by all legacy businesses, compounded by our acquisitions. Our legacy businesses contributed $0.36 of growth, of which Svanehøj and kSARIA contributed $0.12 of that from market share gains, pricing, and productivity actions.

Mike Savinelli: As a result of our top-line performance and margin expansion, EPS reached $2.08 for the quarter, increasing 18% versus the prior year. Lastly, year-to-date free cash flow of $176 million was impacted by $71 million of one-time acquisition-related expenses, which we highlighted in Q1. Excluding these impacts, free cash flow was up 15% year over year, and looking purely at Q2, our free cash flow margin was 11% for the quarter. Let's now turn to the Q2 EPS bridge on Slide six. The 18% EPS growth was primarily driven by strong operational performance delivered by all legacy businesses, compounded by our acquisitions. Our legacy businesses contributed $0.36 of growth, of which Svanehøj and kSARIA contributed $0.12 of that from market share gains, pricing, and productivity actions.

Speaker #2: Excluding these impacts , free cash flow was up 15% year over year , and looking purely at Q2 , our free cash flow margin was 11% for the quarter Let's now turn to the Q2 EPS bridge on slide six .

Speaker #2: The 18% EPS growth was primarily driven by strong operational performance delivered by all legacy businesses , compounded by our acquisitions , our legacy businesses contributed $0.36 of growth , of which and contributed $0.12 of that from market share gains .

Speaker #2: Pricing and productivity actions . The full quarter of SPX flow contributed $0.68 of growth , with the impacts of the incremental interest share count and tax rate mostly offsetting this contribution .

Michael J. Savinelli: The full quarter of SPX FLOW contributed $0.68 of growth, with the impacts of the incremental interest, share count, and tax rate mostly offsetting this contribution. We are maintaining SPX FLOW's EPS accretion expectation of $0.10 to $0.14 for the year. I want to also stress that the net impacts of the tariff refunds were immaterial to the quarter at just a half million dollars. Now let's move on to Slide seven to discuss our updated 2026 outlook. We are raising our full year organic revenue guidance range to 5% to 8% growth, driven by increased bookings in our CCT business, strength in both Flow Technologies projects and short cycle, and continued friction OE outperformance, coupled with operational performance above our original expectations.

Mike Savinelli: The full quarter of SPX FLOW contributed $0.68 of growth, with the impacts of the incremental interest, share count, and tax rate mostly offsetting this contribution. We are maintaining SPX FLOW's EPS accretion expectation of $0.10 to $0.14 for the year. I want to also stress that the net impacts of the tariff refunds were immaterial to the quarter at just a half million dollars. Now let's move on to Slide seven to discuss our updated 2026 outlook. We are raising our full year organic revenue guidance range to 5% to 8% growth, driven by increased bookings in our CCT business, strength in both Flow Technologies projects and short cycle, and continued friction OE outperformance, coupled with operational performance above our original expectations.

Speaker #2: We are maintaining SPX flows . EPS accretion expectation of 10 to $0.14 for the year . I want to also stress that the net impacts of the tariff refunds were immaterial to the quarter at just a half million dollars Now let's move on to slide seven to discuss our updated 2026 outlook .

Speaker #2: We are raising our full year organic revenue guidance range to 5 to 8% growth , driven by increased bookings in our CCP business .

Speaker #2: Strengthened both flow technologies , projects and short cycle , and continued friction . OE outperformance , coupled with operational performance above our original expectations on adjusted operating margin , we expect to deliver over 100 basis points of margin expansion to approximately 20.5% in the midpoint , fueled by top line growth , favorable price to cost ratio , and productivity gains as a result of the momentum we generated in the first half of the year , we are raising our adjusted EPS outlook for 2026 to $8.22 at the midpoint .

Michael J. Savinelli: On adjusted operating margin, we expect to deliver over 100 basis points of margin expansion to approximately 20.5% in the midpoint, fueled by top-line growth, favorable price to cost ratio, and productivity gains. As a result of the momentum we generated in H1 of the year, we are raising our adjusted EPS outlook for 2026 to $8.22 in the midpoint. This represents a $0.37 increase and 14% growth at the midpoint, fueled by volume growth, pricing actions, and productivity initiatives. The low end of our new range now exceeds the high end of our previous guidance range. This revised guidance does not consider any additional net benefits from tariff refunds above the half million dollars from Q2.

Mike Savinelli: On adjusted operating margin, we expect to deliver over 100 basis points of margin expansion to approximately 20.5% in the midpoint, fueled by top-line growth, favorable price to cost ratio, and productivity gains. As a result of the momentum we generated in H1 of the year, we are raising our adjusted EPS outlook for 2026 to $8.22 in the midpoint. This represents a $0.37 increase and 14% growth at the midpoint, fueled by volume growth, pricing actions, and productivity initiatives. The low end of our new range now exceeds the high end of our previous guidance range. This revised guidance does not consider any additional net benefits from tariff refunds above the half million dollars from Q2.

Speaker #2: This represents a $0.37 increase and 14% growth at the midpoint , fueled by volume growth , pricing actions , and productivity initiatives . The low end of our new range now exceeds the high end of our previous guidance range .

Speaker #2: This revised guidance does not consider any additional net benefits from tariff refunds above the half million dollars from Q2 Finally , on cash and capital structure , we are raising the midpoint of our free cash flow guidance to $565 million , resulting in a free cash flow margin between 10 and 11% .

Michael J. Savinelli: Finally, on cash and capital structure, we are raising the midpoint of our free cash flow guidance to $565 million, resulting in a free cash flow margin between 10% and 11%. We made good progress lowering our leverage ratio. We are ahead of target and are driving towards approximately 2.3 times by year-end. Now let me turn the call back over to Luca to wrap up on Slide eight.

Mike Savinelli: Finally, on cash and capital structure, we are raising the midpoint of our free cash flow guidance to $565 million, resulting in a free cash flow margin between 10% and 11%. We made good progress lowering our leverage ratio. We are ahead of target and are driving towards approximately 2.3 times by year-end. Now let me turn the call back over to Luca to wrap up on Slide eight.

Speaker #2: We made good progress lowering our leverage ratio . We are ahead of target and are driving towards approximately 2.3 times by year end Now let me turn the call back over to Luca to wrap up on slide eight .

Speaker #1: Thanks , Mike Before we move to Q&A , let me reinforce a few points . What you see in Q2 , as you saw in Q1 , is it's strategy in action Our entrepreneurial spirit is accelerating growth in our legacy businesses .

Luca Savi: Thanks, Mike. Before we move to Q&A, let me reinforce a few points. What you see in Q2, as you saw in Q1, is ITT's strategy in action. Our entrepreneurial spirit is accelerating growth in our legacy businesses. Our relentless execution is accelerating margin expansion. Our acquisitions are compounding organic value creation more and more. In Q2, the momentum towards our long-term targets is accelerating. As always, I appreciate your time and continued interest in ITT. Liz, please open the line for Q&A.

Speaker #1: Our relentless execution is accelerating margin expansion . Our acquisitions are compounding organic value creation more and more . And in Q2 , the momentum towards our long term targets is accelerating .

Speaker #1: As always , I appreciate your time and continued interest in it Please , please open the line for Q&A .

Speaker #3: The floor is now open for questions At this time , if you have a question or comment , please press star one one on your touchtone phone .

Operator: The floor is now open for questions. At this time, if you have a question or comment, please press star one one on your touchtone phone. If at any point your question has been answered, you may remove yourself from the queue by pressing star one one again. Again, we do ask that while you pose your question, you pick up the handset to provide optimal sound quality. Please limit your questions to one question and one follow-up. Thank you. Our first question comes from Scott Davis with Melius Research.

Speaker #3: If at any point your question has been answered , you may remove yourself from the queue by pressing star one one again . Again , we do ask that while you pose your question , you pick up the handset to provide optimal sound quality .

Speaker #3: Please limit your questions to one question and one follow up . Thank you Our first question comes from Scott Davis with Melius Research

Speaker #4: Good morning . Thanks , operator , and good morning , Luca , Mike and Carleen

Scott Davis: Good morning. Thanks, operator, and good morning, Luca, Mike, and Carlene.

Speaker #1: Hi , Scott .

Luca Savi: Hi, Scott.

Speaker #4: Congrats . Congrats on these numbers . There's really not much to pick on here at all . , so I'm going to talk .

Michael J. Savinelli: Hi.

Mike Savinelli: Hi.

Scott Davis: Hey, congrats on these numbers. There's really not much to pick on here at all. I'd like to talk a little bit about SPX FLOW, because that's the newest asset that we need to learn here. Can you give us a sense, Luca, of kind of where SPX FLOW is in their kind of Lean and operational excellence journey, kind of how you would compare them to kind of your legacy ITT businesses and such, and where the upside is there?

Speaker #4: I'd like to talk a little bit about SP flow because that's the newest asset that we need to learn here where , , can you give us a sense , of kind of where SP flow is in ?

Speaker #4: They're kind of lean and operational excellence journey , kind of how , how you would compare them to kind of your legacy . It businesses and such and where the upside is there

Speaker #1: Sure . So , , I would say when , , when we look at the , at the plants , , if it's shidou , if it's our plant in Poland , if it is even the factory that , , I visited in Italy , say to those are well run plans .

Luca Savi: Sure. I would say when we look at the plants, if it's Xidu, if it's our plant in Poland, if it is even the factory that I visited in Italy, Settala, those are well-run plants, I would say. Good 5S, Scott, and some good talent. I think, though, that the area for improvement that we have in SPX FLOW and in the Lean is really to ensuring that the Lean is entrenched in the DNA in the cell. Today, I would say it's probably more linked to what they were corporate initiatives, the A3 that you see stuck on the board, but not necessarily in improving the productivity in the cell or sometimes the material flow in the factory.

Speaker #1: , I would say , , and , , good , good five s Scott and , , some , some good talent . I think though , that the area for improvement that we , that we have in ESP flow and the lean is really to ensuring that the lean is , Entrenched in the DNA in the cell .

Speaker #1: So today , I would say is probably more linked to what they were corporate initiatives . The A that you see stuck on the board , but not necessarily in improving the productivity in the cell or sometimes the material flow in the factory .

Speaker #1: So there is work to be done , but there is a good level of talent and the plans tend to be in general with a good a good five s

Luca Savi: There is work to be done, but there is a good level of talent, and the plants tend to be, in general, with a good 5S.

Speaker #4: Okay . Good answer . , just a quick follow up . Where are we on price versus cost in your different , in your three different segments ?

Scott Davis: Okay, good answer. Just a quick follow-up. Where are we on price versus cost in your three different segments?

Speaker #1: Yes . When , when you look at the price cost is a pretty much the same dynamic . You have a price cost positive when it comes to flow technologies .

Luca Savi: Yes. When you look at the price cost, it is pretty much the same dynamic. You have a price cost positive when it comes to Flow Technologies and in CCT, because obviously we got more price power in there. Different dynamic in Motion Technologies, where we are recovering some of the cost inflation, but not full, so there are pressures there. At ITT level, we expect to be price cost positive, probably neutral from a margin perspective for the full year.

Speaker #1: And in KT , because obviously we got more price power in their different dynamic in motion technologies where we are recovering some of the cost inflation .

Speaker #1: But not full . So there pressures there , but at it level , we expect to be price cost positive , probably neutral from emerging perspective for the full year .

Speaker #4: Okay . Helpful . I'll pass it on . Best of luck this year .

Scott Davis: Okay. Helpful. I will pass it on. Best of luck this year.

Speaker #1: Thank you . Scott .

Luca Savi: Thank you, Scott.

Speaker #3: Our next question comes from Jeff Hammond with KeyBanc Capital Markets .

Operator: Our next question comes from Jeff Hammond with KeyBanc Capital Markets.

Speaker #5: Hi , Jack . Hey . Good morning everyone , great . Great start here with SPX flow . , just wondering if you could maybe speak to just the , the underlying demand momentum and flow .

Luca Savi: Hi, Jeff.

Jeff Hammond: Hey, good morning, everyone.

Michael J. Savinelli: Morning.

Mike Savinelli: Morning.

Jeff Hammond: Great start here with SPX FLOW. Just wondering if you could maybe speak to just the underlying demand momentum in SPX FLOW. I guess that's what's driving the order growth and kind of any early wins you're seeing around maybe backing off 80/20 or synergies. Then, maybe just expand on the funnel comment in SPX FLOW, which I think you said was expanding. Thanks.

Speaker #5: I guess that's what's driving the order growth and kind of any early wins you're seeing around , you know , maybe backing off 80/20 or , or synergies and then maybe just expand on the , you know , the funnel comment and SPX flow , which I think you said was expanding .

Speaker #5: Thanks .

Speaker #1: , yes . So when , when you look at the , the funnel of , , so the orders is a great performance .

Luca Savi: Yes. When you look at the funnel of that, the orders is a great performance. If you think about up 9% in Q2. Year to date, our orders are up 7%, and also our book-to-bill is above one. Our book-to-bill in Q2 for SPX FLOW is 1.13. Good performance on there. What we see is really good recovery on the chemicals. If you think about the mixes dynamic, we had a very good performance on the orders on the mixers. Good performance on Waukesha as well, 10% orders growth. In Nutrition and Health, I can tell you that, just to give you a little bit more color, I participated to some very important bid reviews for large projects in Europe. Good orders, book-to-bill above one, building backlog, and the funnel of opportunities in SPX FLOW is growing.

Speaker #1: If you think about up 9% in , , in Q2 year to date , our orders are up 7% . And also our book to bill is above what our book to bill in Q2 for , , ESP flow is 1.13 .

Speaker #1: So good performance on there . What we see is really a good , , recovery on the , on the chemicals . So if you think about the mixers dynamic , and we had a very good performance on the orders on the mixers , good performance on Waukesha as well .

Speaker #1: 10% orders growth and the nutrition and health , I can tell you that just to give you a little bit more color , , I participated to some very important bid reviews for large projects in Europe .

Speaker #1: So good orders book to bill above one building backlog and the funnel of opportunities in ESP flow is , is growing . And this I would say is geographically across the board , both in North America as well as as well as in Europe

Luca Savi: This, I would say, is geographically across the board, both in North America as well as in Europe.

Speaker #5: Okay , that's good to hear . And then , , just on the , I mean , the c orders were , were pretty eye popping and , and I think you mentioned record July .

Jeff Hammond: Okay. That's good to hear. Just on the CCT orders were pretty eye-popping, and I think you mentioned record July. Can you just kind of spike out underlying demand versus kind of good lumpiness? Yeah, thanks.

Speaker #5: , can you just kind of spike out underlying demand versus kind of good lumpiness ? , yeah . Thanks

Speaker #1: Sure , sure . Yeah . I mean , KT was simply outstanding in terms of the orders . Everything was up . So it's not just CCP up 58% .

Luca Savi: Sure, Jeff. CCT was simply outstanding in terms of the orders. Everything was up. It's not just CCT up 58%, controls were up 22%. Connectors were up 38%. kSARIA is true. You're right, Jeff, in terms of lumpiness. Probably, you remember that Q1, we postponed some of the orders from Q1 to Q2. If you look at kSARIA today, orders up 46%. There is really a market tailwind, which I was referring to in the prepared remarks, but there is a lot of market share gains. We are participating in some programs, and we know that we have rewon the programs and more. This is good. Some of this has got long-term visibility also to 2028 and beyond.

Speaker #1: Controls were up , 22 connectors were up , 38 Kesaria is true . You're right , Jeff , in terms of lumpiness , probably you remember that Q1 we postponed some of the orders from Q1 to Q2 .

Speaker #1: But if you look at César today , orders up 46% . So there is really a market tailwind , was referring to in the prepared remarks .

Speaker #1: But there is a lot of market share gains . So we are participating in some programs , and we know that we have rewound that programs and more .

Speaker #1: So this is good . Some of these has got long term visibility also to 28 and beyond . But I can tell you that the backlog that we have visible for Q3 , Q4 , and Q1 of next year compared to what we saw last year , at the same time , is considerably higher .

Luca Savi: I can tell you that the backlog that we have visible for Q3, Q4, and Q1 of next year compared to what we saw last year at the same time is considerably higher. Great growth for the midterm as well as long term.

Speaker #1: So, great growth for the mid-term as well as the long term.

Speaker #6: Okay . Thanks for the time .

Jeff Hammond: Okay, thanks for the time.

Speaker #1: Thanks , Jack .

Luca Savi: Thanks, Jeff.

Speaker #3: Our next question comes from Mike Halloran with Baird .

Operator: Our next question comes from Mike Halloran with Baird.

Speaker #1: Hi , Mike .

Luca Savi: Hi, Mike.

Speaker #7: Hey . Good morning everyone . How are you doing ? , so a couple questions here . First , you know , can you help with the back half of the year ?

Mike Halloran: Hey, good morning, everyone. How you doing? A couple questions here. First, can you help with the H2 cadencing as you think about earnings, revenue, and any of those metrics? Maybe also put in context how your orders are tracking in terms of timeline, how much visibility it's giving you. Essentially, it feels with the strength in the orders, you're getting a little bit of longer dated, longer cycle type orders coming through. Just curious how we should think about that order to revenue conversion.

Speaker #7: Cadencing . , as you think about earnings , revenue and any of those metrics , but then maybe also put in context how your orders are tracking in terms of timeline , how much visibility it's giving you essentially , it feels with this strength in the orders , you're getting a little bit of longer dated , longer cycle type orders coming through , just curious how we should think about that order to revenue conversion

Speaker #1: Sure . So if it's okay , Mike , do you address the the full year 26 EPS guidance sequentially ? And I talk about the orders .

Luca Savi: Sure. If it's okay, Mike, to address the full year 2026 EPS guide and sequential, and I talk about the orders?

Michael J. Savinelli: Yep.

Mike Savinelli: Yep.

Speaker #2: Thank you . That'll be fine . So I just want to mention that we had significant step up in performance in Q2 . And for the balance of the year for the second half , we expect to remain at that elevated level of performance .

Luca Savi: Thanks.

Michael J. Savinelli: That'd be fine. Just want to mention that we had significant step-up in performance in Q2, and for the balance of the year, for H2, we expect to remain at that elevated level of performance. Looking at each value center, for Motion Technologies, we expect some seasonality in H2, expecting stable margins. For CCT, we're expecting consistent revenue and margin similar to Q2, Flow Technologies' margin expansion, we expect to expand from synergies.

Mike Savinelli: That'd be fine. Just want to mention that we had significant step-up in performance in Q2, and for the balance of the year, for H2, we expect to remain at that elevated level of performance. Looking at each value center, for Motion Technologies, we expect some seasonality in H2, expecting stable margins. For CCT, we're expecting consistent revenue and margin similar to Q2, Flow Technologies' margin expansion, we expect to expand from synergies.

Speaker #2: And then looking at each value center , , for for motion tech , we expect , , you know , some seasonality in the second half , stable margins .

Speaker #2: , for CCTV , we're expecting consistent revenue and margin similar to Q2 and Pfts margin expansion . We expect to , , to , to expand from , from synergies

Speaker #1: And talking about the orders , , Mike , I think that , , different , different picture . If you think about CCTV , as I said , incredible performance on the orders , there are some long term programs .

Luca Savi: Talking about the orders, Mike, I think that different picture. If you think about CCT, as I said, incredible performance of the orders. There are some long-term programs, that gives us fantastic visibility in the future. As I said, in the short term, our backlog is incredibly up for also the next few quarters. Very good visibility there. When you look at Flow Technologies, the orders, up, of course, 91% in total. If I look at the book-to-bill, Svanehøj in book-to-bill is 1.3, just to give you an example. If you have a business like this, which is growing 39% in Q2, on top of that, you got a book-to-bill of 1.3 and you're building backlog. This is visibility in the short, medium term. SPX FLOW, the revenue is up 5%, and the book-to-bill is 1.13.

Speaker #1: So that gives us fantastic visibility in the future . But as I said , in the short term , our backlog is incredibly up for also the next few quarters .

Speaker #1: So very good visibility there . When you look at flow technologies , the orders , you know , up , of course , 91% in total , but if I look at the book to beer or book to bill is 1.3 .

Speaker #1: Just to give you an example . So if you have a business like this , which is growing 39% in Q2 , on top of that , you got a book to bill of 1.3 , and you're building backlog .

Speaker #1: This is visibility in the short medium term , the ESP flow , the the revenue is up 5% . And the book to Bill is 1.13 .

Speaker #1: So we are building backlog for the for the medium , for the medium term . And and then when you go to motion technologies , we are winning more and more awards that will feed market share gains .

Luca Savi: We are building backlog for the medium term. When you go to Motion Technologies, we are winning more and more awards that will see the market share gains. KONI orders were also up 9% thanks to rail and defense. Great visibility for the long term, but also in the short and medium.

Speaker #1: And then, Connie, orders were also up 9% thanks to rail and defense. So, great visibility for the long term, but also in the short and medium term.

Speaker #7: No , that makes sense . That and then maybe just a state of the union on the legacy flow assets . , what you're seeing on a regional basis , maybe specific emphasis on directional dynamics in the Middle East .

Mike Halloran: No, that makes sense. Appreciate that. Maybe just state of the union on the legacy Flow assets, what you're seeing on a regional basis, maybe specific emphasis on directional dynamics in the Middle East.

Speaker #7: , of course , what you're seeing in terms of project outlays

Luca Savi: Of course

Mike Halloran: What you're seeing in terms of project outlays.

Speaker #1: , of course . So let me address the Middle East first . And then we talk about the other regions . When you look at about the Middle East .

Luca Savi: Of course. Let me address the Middle East first, then we talk about the other regions. When you look at about the Middle East, where I know that this sounds strange, our business in the Middle East has been growing for the first six months incredibly well. This is because of all the orders that we won in the last couple of years that we are delivering. We had a huge backlog, and we are delivering this backlog. Huge growth from a revenue perspective in Q1 and Q2. The orders in the Middle East have been delayed, and this probably will impact the regional growth in Saudi Arabia and in the Middle East when it comes to the next few quarters. Now, what we have seen is that some of the orders are being now given to the EPCs.

Speaker #1: Where I know that this sounds strange , but our business in the Middle East has been growing for the first six months , incredibly well .

Speaker #1: And this is because of the all the orders that we won in the last couple of years that we are delivering . We had a huge backlog and we are delivering this backlog .

Speaker #1: So huge growth from a revenue perspective in Q1 and Q2 , the orders in the Middle East have been delayed . And this probably will impact the regional in that in Saudi Arabia and in the Middle East .

Speaker #1: When it comes to , you know , the next few quarters . Now , what we have seen is that some of the orders are being now , , given to the EPCs .

Speaker #1: So we have started seeing some , , moves in , in terms of orders , which is good The other thing that I want to highlight on the Middle East is happening , performance , despite the fact that they are in the middle of it .

Luca Savi: We have start seeing some moves in terms of the orders, which is good. The other thing that I want to highlight on the Middle East is Habonim performance. Despite the fact that they're in the middle of it, Habonim has an incredible performance with orders up 18% in the quarter, revenue up 19%. Year to date, both orders and revenue up double digits and book-to-bill above one. Great over there. Now, if you look at the funnel, the funnel is increasing year-over-year. As a matter of fact, the funnel is up 34% year-over-year and 6% sequentially. When you look at the region, your question, North America, Latin America, and interestingly, Middle East are up. Forget about the Middle East funnel up, because mainly that is because the orders get delayed.

Speaker #1: Habonim has an incredible performance with orders up 18% in the quarter . Revenue up 19% year to date . Both orders and revenue up double digit , and the book to bill above one .

Speaker #1: So great over there . Now , if you look at the at the funnel , the funnel is increasing year over year . As a matter of fact , the the funnel is up 34% year over year .

Speaker #1: And 6% sequentially . When you look at the region . Your question , North America , Latin America , and interesting Middle East are up .

Speaker #1: Forget about the Middle East funnel up because mainly that is because the orders get delayed . But North America and Latin America funnel up .

Luca Savi: North America and Latin America funnel up highlight the strength of those regions because revenue is growing, book-to-bill above one, your orders are growing even more. On top of that, your funnel is growing, you're replenishing at a faster rate. Whereas Europe and Asia Pacific funnels are down a little bit.

Speaker #1: I lost the strength of those regions because revenue is growing . Book to bill above one . So your orders are growing even more .

Speaker #1: And on top of that , your funnel is growing . So you're replenishing at a faster rate . So whereas Europe and Asia Pacific funnels are down a little bit .

Speaker #7: That was great . Really appreciate it . Congrats on the quarter .

Mike Halloran: That was great. Really appreciate it. Congrats on the quarter.

Speaker #1: Thank you .

Luca Savi: Thank you.

Speaker #3: Our next question comes from Daniel de Chico with BMO Capital Markets

Operator: Our next question comes from Daniel DiCicco with BMO Capital Markets.

Speaker #8: Great . Thank you for taking my question . How are you ?

Daniel DiCicco: Great. Thank you.

Daniel DiCicco: Great. Thank you-

Luca Savi: Hi, Dan

Daniel DiCicco: taking my question. How are you?

Daniel DiCicco: ..taking my question. How are you?

Luca Savi: Hi. Good. How are you?

Speaker #1: Good .

Speaker #8: How are you ? , good . Good . So it you're winning . Share literally everywhere . So I guess , you know , we've talked about some of the drivers , but maybe where do you see the most opportunity still in the portfolio when we kind of look out to the medium term

Daniel DiCicco: Good. It looks like you're winning share literally everywhere. I guess, A, we've talked about some of the drivers, but maybe where do you see the most opportunity still in the portfolio when we kind of look out to the medium term?

Speaker #1: Okay . So , , you're absolutely spot on . Then we are winning share across the board . Is it in Coney Rail ?

Luca Savi: Okay. You're absolutely spot on, Dan. We are winning share across the board. Is it in KONI, rail? I was in China, and the team was presenting the market share that we have with the China Railway CRRC. Fantastic. We're winning market share in China with the Chinese OEMs, and therefore, we expect to increase market share there. We increased market share, you see, on the growth with a 21% revenue growth in Flow Technologies organic. You know that we're winning market share there as well, mainly because of our project management and also in Connectors. I would say we still have opportunities across the board, but probably more in the FT side, on the Flow Technologies as well as CCT. This is where we can even grow faster and more.

Speaker #1: Is it in ? I was in China and they were the team was presenting the market share that we have with the China CRC .

Speaker #1: Fantastic . We're winning market share in in China with the Chinese OEMs . And therefore we expect it to increase market share there .

Speaker #1: , we increased market share . You see on the growth with the 21% revenue growth in flow technologies , organic , you know , that we're winning market share there as well , mainly because of our project management .

Speaker #1: And also in connectors , I would say we still have a opportunities across the board , but probably more on the in the feet side , on the flow technologies as well as CCP .

Speaker #1: So this is where we can even grow faster and more

Speaker #8: Great . Thank you for that . , and then just a quick follow up . I know you've talked about it a little bit in the past , but just some of the commercial opportunities you see within SPX flow and then maybe specifically some pricing opportunities on the nutrition and health side would be great .

Daniel DiCicco: Great. Thank you for that. Just a quick follow-up. I know you've talked about it a little bit in the past, but just some of the commercial opportunities you see within SPX FLOW, and maybe specifically some pricing opportunities on the Nutrition and Health side would be great.

Speaker #9: Sure . So , .

Luca Savi: Sure. I think that when we look at SPX FLOW, let me give an example. A few weeks ago, I was in Xidu, China, where we have a very good plant in terms of SPX FLOW. I think our approach in China could probably be adapted a little bit more to the market. What I mean by that, invest more on the engineering side, on the local application engineering, in some local R&D, that we are actually adapting and making decision more closer to the market, closer to the customer. This is what has generated a lot of success for our friction business in China, for our KONI business in China, and for our Connectors business in China in the last few years. Decentralize, empowering, developing more the periphery and the markets like China will definitely be a great opportunity.

Speaker #1: I think that when , , when we look at SPX flow , , let me give an example . , a few weeks ago , , I was in Qingdao , China , where we have a very good plan in terms of ESP law , but I think our approach in , in China could be probably be adapted a little bit more to the market .

Speaker #1: What I mean by that , invest more on the engineering side , on the local application engineering in some local R&D . So that we are actually adapting making decisions more closer to the market , closer to the customer .

Speaker #1: This is what has generated a lot of success for our friction business in China . For our business in China , and for our connectors business in China .

Speaker #1: In the last few years . So decentralized , empowering , developing more the periphery and the markets like China will definitely be a great opportunity .

Speaker #1: Similar opportunities out to our plant in in small plant in Italy . I mean , that team is eager to win and conquer more .

Luca Savi: Similar opportunities out at Settala, our small plant in Italy. I mean, that team is eager to win and conquer more. We need to ensure that we have, though manage, a more decentralized, and make decision closer to the customer and closer to the market. We are also working on revenue synergies, particularly in Latin America for mixers, I would say. The pause that we have in the Middle East presents an opportunity for us to get ready with mixers or the Bornemann lube pumps with localization in Saudi.

Speaker #1: We need to ensure that we have the manage a more decentralized and make decision closer to the customer and closer to the market .

Speaker #1: We are also working on revenue synergies , particularly in Latin America for , , for mixers , I would say . And the pose that we have in the Middle East presents an opportunity for us to get ready with mixers or the Brian Lube pumps with localization in Saudi

Speaker #8: Great . Thank you so much . Congratulations on the great quarter .

Daniel DiCicco: Great. Thank you so much. Congratulations on the great quarter.

Speaker #1: Thanks , Dan .

Luca Savi: Thanks, Dan.

Speaker #3: Our next question comes from Joe Giordano with TD Cowen .

Operator: Our next question comes from Joe Giordano with TD Cowen.

Speaker #10: Hey guys . Good morning .

Joe Giordano: Hey, guys. Good morning.

Speaker #9: Hi , Joe .

Luca Savi: Hi, Joe.

Speaker #10: Hey . Just curious what the opportunity set is . You've been talking about winning valves market share for a while with the legacy portfolio in like , , pharma and health and just curious what the potential is for you to like , bring in and pull in some of the ESP flow into those discussions from the wins that you've had on the legacy in valves .

Joe Giordano: Hey, just curious what the opportunity set is. You've been talking about winning valves market share for a while with the legacy portfolio in like Nutrition and Health. Just curious what the potential is for you to bring in and pull in some of the SPX Flow into those discussions from the ones that you've had on the legacy in valves.

Speaker #9: Yeah , that's a .

Luca Savi: Yeah. You're absolutely right, Joe. It looks like you were listening to some of our meetings. Yeah. We have a very good penetration in some of the big pharma with our Lancaster plant because of our proprietary technology with the EnviZion, and we won incredibly well. This is a market where we can expand with some of the valves of SPX Flow, but also with the mixers.

Speaker #1: You're absolutely right , Joe . , it looks like listening to some of our meetings in our meetings is , yeah , we have , we have a very good penetration in some of the Bayer Pharma with our lung plant because of our , , you know , proprietary technology with the envision .

Speaker #1: And we want incredibly well , , this is a market where we can expand with some of the valves of ESP flow , but also with the mixers .

Speaker #1: So , , this conversation are happening and , , and we need , it could be a cross , a sales synergies that , , we probably were underestimating during the due diligence .

Joe Giordano: Yeah.

Luca Savi: These conversations are happening and it could be cross-sale synergies that we probably were underestimating during the due diligence. Very fair.

Speaker #1: Very fair

Speaker #10: Yeah , that's kind of what I figured . And then can you talk about what's going on in the Middle East , the implications of this , right ?

Joe Giordano: Yeah. That's kind of what I figured. Can you talk about what's going on in the Middle East, the implications of this, right? Like, if we have to start moving around where LNG capacity goes and make new pipelines and have different shipping routes, like, I'd imagine that you're a pretty big beneficiary from that across multiple elements of the firm. I mean, Svanehøj maybe, and maybe on the infrastructure itself. Can you talk about what, if that's what we ultimately have to do, kind of rethink the kind of where some of this energy flows through, how does that impact you guys?

Speaker #10: Like if we have to start moving around where LNG capacity goes and make new pipelines and have different shipping routes , like I'd imagine that you're a pretty big beneficiary from that across multiple elements of the firm .

Speaker #10: I mean , maybe and maybe on the infrastructure itself , can you talk about what if that's what we ultimately have to do ?

Speaker #10: Kind of rethink the kind of where some of this where some of this energy flows through ? How does that impact you guys ?

Speaker #9: Sure . There are there are always absolutely right .

Luca Savi: Sure. Absolutely right. There are always two sides to the coin, right? If our factory in demand gets penalized on one side in the short term, I mean, for the shipping perspective in terms of what the business could be for Svanehøj could be a positive one. If there is more investment in pipelines will use the BB3 pumps. Interestingly enough, the BB3 is the pump that we went already completely, the complete range through VAVE, and we have a very good product. A product that has allowed us actually to win the Vaca Muerta project in Argentina. As well, further investment in different regions could be also good for our Bornemann or Goulds pumps. For example, what's happening in Venezuela is probably going to be a great tailwind for our Bornemann pumps.

Speaker #1: There are always two sides to the coin , right ? So if , , if our , factory in demand , , gets penalized on one side in the short term , I mean , for the shipping perspective , in terms of what the business could be for , oil , could be a positive one if there is a more investment in pipelines , pipelines will use the BB three pumps .

Speaker #1: And interestingly enough , the BB three is the pump that we went already completely . The complete range through the . And we have a very good product , a product that has allowed us actually to win the Vaca Muerta project in Argentina .

Speaker #1: And then , , as well , further investment in different regions could be also good for , , for our born or goods pumps .

Speaker #1: So for example , what's happening in Venezuela is probably going to be a great for our Boardman pumps . Let's not forget the Venezuela was probably the largest market for Borneman in , in , in the long path in the far past .

Luca Savi: Let's not forget that Venezuela was probably the largest market for Bornemann in the long past, in the far past. Definitely great opportunities across the board.

Speaker #1: So definitely great opportunities across the board .

Speaker #10: Thanks guys .

Joe Giordano: Thanks, guys.

Speaker #9: Thank you . Joe .

Luca Savi: Thank you, Joe.

Speaker #3: Our next question comes from Nathan Jones with Stifel .

Operator: Our next question comes from Nathan Jones with Stifel.

Speaker #10: Good morning everyone .

Nathan Jones: Morning, everyone.

Speaker #9: Morning , Nathan .

Luca Savi: Morning, Nathan.

Speaker #10: I'll follow up to Scott's question on Lane and ask you where you think ESP is on there . 8020 journey . And I guess I'm specifically interested in hearing where they are on value based pricing , given that that comes typically later in the cycle there .

Nathan Jones: I'll follow up to Scott's question on Lean and ask you where you think SPX is on their 80/20 journey. I guess I'm specifically interested in hearing where they are on value-based pricing, given that that comes typically later in the cycle there. I know they'd been on an 80/20 journey since about when they went private, just any updates or thoughts that you have around that?

Speaker #10: I know they've been on an 80/20 journey since about when they went private, but just any updates or thoughts that you have around that?

Speaker #9: Sure .

Luca Savi: Sure. You know that I'm not an 80/20 guy, right? Listen, 80/20 is a good tool. Do we use it in ITT? Of course, we do. We do it on the safety, on the quality, use 80/20, absolutely. I'm not a fan of the 80/20. I'm a fan of the 100, and to go after. If some of our competitors want to leave the 20, I'm happily going after that 20. To be honest with you, we are reversing that approach of the 80/20 and to have a much more rational and much more common sense. To be honest with you, what we are adopting is common sense and approach rigorously. That's it. It could be 80/20, it could be 90/10, it could be 100. We are reversing that to be much more business savvy.

Speaker #1: You know that I'm not an 80/20 guy , right ? , it's , , listen , I 8020 is a good tool . Do we use it in ICT ?

Speaker #1: Of course we do . We do on the safety , or the quality use 8020 . Absolutely . But , , I not a fan of the 8020 .

Speaker #1: I'm a fan of the 100 . And to go after . So some of our competitors want to leave there . The 20 I'm happily going after that .

Speaker #1: 20 , so , , to be honest with you , we are reversing that approach of the 8020 and to have a much more , , rational and much more common sense , to be honest with you , what we are adopting is common sense and approach rigorously .

Speaker #1: That's it . It could be 8020 , it could be 9010 . It could be 100 . So we are reversing that to be much more business savvy .

Speaker #1: Now when it comes to the value based pricing , , the team is , is good at value based pricing . , when I look , when I talk commercially to , with Wendy or with , , with Rudy , I mean , they , they definitely know their market , their customers and they know exactly how to price different opportunities .

Luca Savi: Now, when it comes to the value-based pricing, the team is good at value-based pricing. When I talk commercially with Wendy or with Rudy, they definitely know their market, their customers, and they know exactly how to price different opportunities. This is also in Nutrition and Health in some of those bids that I participated to. Silvia, the leader, the top salesperson, and the management team are really able to push it to the right price and to the right value.

Speaker #1: And this is also in nutrition and health in some of those bids that I participated to , , Sylvia , the leader , , the , the top sales person and , and the management team are really able to , to push it to the right , to the right price and to the right value .

Speaker #10: Interesting . Fair enough . I guess on the revenue synergy opportunities you talked about some of the , you know , biopharma opportunities pulling ESP product through there .

Nathan Jones: Interesting. Fair enough. I guess on the revenue synergy opportunities, you talked about some of the biopharma opportunities pulling SPX product through there. Are there opportunities that you've identified to pull legacy ITT products through to some of the end markets or to combine with some of the SPX products to generate revenue synergies there? Thanks for taking the questions.

Speaker #10: , their opportunities that you've identified to pull , , legacy , it , , products through , , to , to some of the end markets or to combine with , with some of the ESP products to generate revenue synergies there .

Speaker #10: And thanks for taking the questions .

Speaker #9: Sure .

Luca Savi: Sure. I think that the largest one on that front is the Bornemann hygienic pumps. If we look at the Bornemann, mainly in the oil and gas, the chemical, et cetera, but we have an application. We got very good products for hygienic. Now, having said that, we were nobody in hygienic. We didn't have the proper channels. Therefore, if you think about it, what Waukesha Cherry-Burrell had is really great channel on hygienic. Having Waukesha Cherry-Burrell to sell Bornemann pumps in the US through their channel is really the greatest opportunity, I would say. In some cases, they might have some strong distributor that we may not have in that region. I'm talking about mixers, for example, with Goulds pumps, and therefore we might have the benefit of utilizing their distributor instead of ours and vice versa. That's really where we see the benefits.

Speaker #1: I think that the largest one on that front , it will in the boredom and generic pumps , if we look at the borneman , you know , mainly in the in the oil and gas , and chemicals , etc.

Speaker #1: , but we have an application . We got very good products for hygienic . Now , I've said that we are we were nobody in hygienic .

Speaker #1: We didn't have the proper channels . And therefore , if you think about it , , what Waukesha had is really great channel on hygienic .

Speaker #1: So having a Waukesha to sell Burnham and pumps in the US through their channel is , is really a the greatest opportunity , I would say .

Speaker #1: And in some cases they might have , you know , some strong distributor that we might not have in that region . , I'm talking about mixers , for example , to go with pumps .

Speaker #1: And therefore we might have the benefit of utilizing their distributor instead of ours . And vice versa . That's really where , where we see the benefits .

Speaker #10: Great . Thanks for taking the questions .

Nathan Jones: Great. Thanks for taking the questions.

Speaker #9: Thank you . Nathan .

Luca Savi: Thank you, Nathan.

Speaker #3: Our next question comes from Vlad Bystritsky with Citigroup

Operator: Our next question comes from Vlad Bystricky with Citigroup.

Speaker #10: Hey , good morning guys .

Vlad Bystricky: Hey, good morning, guys.

Speaker #9: , hi , Vlad .

Luca Savi: Hi, Vlad.

Speaker #11: Thanks for

Vlad Bystricky: Thanks.

Speaker #12: Morning . Morning .

Luca Savi: Morning.

Speaker #11: Thanks for taking my call . And nice results . Obviously . , just on , on the , , ESP flow orders and revenue momentum .

Vlad Bystricky: Thanks for taking my call. Nice results, obviously. Just on the SPX FLOW orders and revenue momentum, can you parse out a little how much of that is volume versus price driven? I guess more broadly for ITT overall, how you're thinking about price contributing to organic growth this year and evolving going forward given lingering inflation?

Speaker #11: Can you , , parse out a little how much of that is volume versus price driven ? And then I guess more broadly for it overall , how you're thinking about , , price contributing to organic growth this year and evolving going forward , given a lingering inflation ?

Speaker #9: Sure .

Luca Savi: Sure. Thank you. When it comes to SPX FLOW, the growth is mainly volume. There is little price on that one. When also you look at our, if you look, for example, our legacy show cycle orders in Flow Technologies, they were up 5% in the quarter. Of that 5%, 4% is volume, is real growth, it's volume growth, and 1% is price. As you can see, we need to be much more surgical today when it comes to price. Having said that, our price-cost equation remains positive for Flow Technologies every quarter and for the full year.

Speaker #1: , thank you . . So , , when it comes to ESP flow , the growth is mainly volume . , there is a little price on , on , on that one .

Speaker #1: And then when also you look at our , if you look , for example , our legacy short cycle orders in flow technologies , they were up 5% in the quarter of that 5% , 4% is volume is real growth .

Speaker #1: It's volume growth . And 1% is price . So as you can see , we need to be a much more surgical . Today when it comes to to price .

Speaker #1: Having said that , our price cost equation remains positive for , , for flow technologies . Every quarter and for the full year

Speaker #11: Got it . Thanks , Luca . And then , , just shifting to CCP and I guess specifically on , on Casauria . , you know , given the orders growth , you're seeing there , I know some of it is , is , is longer cycle and extending out , but just how are you thinking about capacity at the , at the casauria business and your ability to ramp to deliver versus these large orders and really supply chain ability to keep up as well

Vlad Bystricky: Got it. Thanks, Luca. Just shifting to CCT and I guess specifically on kSARIA. Given the orders growth you're seeing there, I know some of it is longer cycle and extending out, how are you thinking about capacity at the kSARIA business and your ability to ramp to deliver versus these large orders and really supply chain ability to keep up as well?

Speaker #7: Sure .

Luca Savi: Sure. You're absolutely right. Great performance on the orders. I would say also great performance on the revenue side, because if you look at also Q2, kSARIA revenue was up 28%. Great performance. As at today, we do not see any capacity constraint on the kSARIA front. As a matter of fact, when we look at the capacity, this is exactly why we made the acquisition of Aerospace Controls. We were concerned of being able to feed the demand and the growth on the connector side, Aero and Defense, we purchased Aerospace Controls, we have insourced that, and we are able to have a better secure and more resilient supply chain. No real constraint from a capacity from a kSARIA point of view.

Speaker #1: So you're absolutely right . I mean , it's great performance on the orders . , I would say also great performance on the revenue side , because if you look at also Q2 Kesaria performed revenue was up 28% .

Speaker #1: So great performance as at today , we do not see any capacity constraint , , on the , on the Kesaria front , as a matter of fact , when we look at , , at the , the , at the capacity , this is exactly why we made the acquisition of aerospace contacts , right ?

Speaker #1: We were concerned of being able to feed the demand and the growth on the connector side error , the fence . And therefore we purchase aerospace contacts .

Speaker #1: And now we have in-sourced that and we are able to have a better secure and more resilient supply chain . But no real , constraint from capacity , from a from a point of view

Speaker #11: , good to hear . Appreciate that , Luca . I'll get back into queue .

Vlad Bystricky: Good to hear. Appreciate that, Luca. I'll get back. Thank you.

Speaker #13: Thank you .

Luca Savi: Thank you.

Speaker #3: Our next question comes from Andrew Obin with Bank of America

Operator: Our next question comes from Andrew Obin with Bank of America.

Speaker #14: Yes . Good morning

Andrew Obin: Yes, good morning.

Speaker #1: Hi , Andrea .

Luca Savi: Hi, Andrew.

Andrew Obin: Morning. Hey, how are you? Just a question on margin guide raise. Just a question in terms of, I think Q2 was a little bit short. The quarter was good, I'm not complaining. The quarter came a little bit short on margin versus what we were modeling. It seems that you raised on margins into H2, and just trying to understand the dynamic. Why do you feel better about margins into H2?

Speaker #14: Hey , how are you , just a question . , on margin , , guide rates . , you know , just a question .

Speaker #14: , in terms of , , you know , I think second quarter was a little bit short and the quarter was good . I'm not complaining , but the quarter came a little bit short on margin versus what we were modeling .

Speaker #14: , but it seems that you raised , , on margins , , into the second half and just trying to understand the dynamic , , why do you feel better about margins into the second half ?

Speaker #1: Absolutely . I think to be honest with you , Andrew , you're right . I mean , every single place we go , we have plenty of opportunities for improvement .

Luca Savi: Absolutely. I think, to be honest with you, Andrew Obin, you're right. Every single place we go, we have plenty of opportunities for improvement. Absolutely. When you look at the margins, I think that Motion Technologies at 21.1% margin, they grew up 90 basis points. Great performance, I would say, if you think about where they play in the market that they play, the pressure they're in. What we are working in Motion Technologies is to consolidate and maintain this level of margin for the full year so that this is in it, is solid rock. When you look at the CCT margin at 21.7% is actually a record margin for CCT, and this is with the dilution of kSARIA. Without kSARIA, this margin will be higher than 23%, and improve sequentially more than 240 basis points.

Speaker #1: , absolutely . Now , I would say when you look at the margins , I think that , , most technologies at 21.1% margin , they grew up 90 basis points .

Speaker #1: So , a great performance , I would say if you think about where they play in the market that they play the pressure they're in and , , so what we are working in motion technology is to consolidate and maintain this level of margin for the full year .

Speaker #1: So that this is in it . Is solid rock . When you look at the CCP , CCP margin at 21.7 is actually a record margin for CCP .

Speaker #1: And this is what the dilution of Kesaria is. I mean, without Kesaria, this margin would be higher than 23%. So, it improved sequentially by more than 240 basis points.

Speaker #1: So those I think that what you might be referring to is that the dilution that we had in flow technologies probably is a little bit higher than , , than what , , than what we were expecting .

Luca Savi: I think that what you might be referring to is the dilution that we had in Flow Technologies probably is a little bit higher than what we were expecting. Okay? Having said that, at the 21, the legacy business in Flow Technologies is up 70 basis points, and we're already probably a great benchmark when you look in the market. You're right, a little bit of a higher dilution in Q2, but as we move forward, you will see this margin improving more and more because the productivity ramp up through the year, and you will have the acquisition cost synergies really starting having an impact.

Speaker #1: Okay. But having said that, at the 21, the legacy business in Flow Technologies is up 70 basis points, and we're already probably a great benchmark.

Speaker #1: When you look in the market . So you're right , a little bit of a higher dilution in Q2 . But as we move forward , you will margin improving more and more because the productivity ramp up through the year .

Speaker #1: And you will have the , , acquisition cost synergies really starting having an impact .

Speaker #14: So it's really about flow

Andrew Obin: It's really about Flow Technologies?

Speaker #1: Yeah , that is really , really more dilution by flow . Absolutely .

Luca Savi: Yeah.

Andrew Obin: Okay.

Luca Savi: This is really more dilution by Flow Technologies. Absolutely right.

Speaker #14: Right . And then the opposite question , , you know , the second thing , if you sort of back into second half organic growth , , I may be the math may be incorrect , but I hope it is sort of we're getting sort of slightly down to plus 6% implied , , and , you know , but the first half , you know , you got 12% organic and orders , you know , I think we're very , very impressive .

Andrew Obin: The opposite question. The second thing, if you sort of back into H2 organic growth, the math may be incorrect, but I hope it is. We're getting sort of slightly down to +6% implied. The H1, you got 12% organic and orders, I think were very impressive.

Speaker #14: , so the opposite on the top line , very strong first half , , but second half feels overly conservative . Any commentary there

Luca Savi: Yeah.

Andrew Obin: The opposite on the top line, very strong H1, H2 feels overly conservative. Any commentary there?

Speaker #1: Yeah . , just a couple of things . So I would like to bring it back to the full year picture . Right .

Luca Savi: Yeah. Just a couple of things. I would like to bring it back to the full year picture. When you look at the full year picture, we are posting is a really great growth, and we are raising the growth for the full year. When you look at the dynamics sequentially, I think that a couple of things. First, it gets a little bit of a tougher compare, year-over-year, in terms of for Q3 and Q4. What you have from a sequential point of, from a year-over-year growth, you have to think about it that Q4 of this year will have four days less than Q4 of last year. From a year-over-year, you've got that dynamic. Of course, there is always the Middle East, where we have been growing tremendous in the H1.

Speaker #1: When you look at the full year picture , we are posting is a really great growth and we are raising the growth for the full year .

Speaker #1: Now , when you look at the dynamic sequentially , I think that a couple of things . First , it gets a little bit of a tougher compare , right ?

Speaker #1: Year over year in terms of the for Q3 and Q4 , then what what you have from a sequential point of view from a , from a year over year growth , you have to think about it that Q4 of this year will have a four days less than Q4 of last year .

Speaker #1: So from a year over year , you got that dynamic . And then , of course , there is always the Middle East where we have been growing tremendous in the first half .

Speaker #1: And . But because of the orders delay , there is going to be a little bit of a of a decrease when it comes to the next few quarters .

Luca Savi: Because of the orders delay, there is going to be a little bit of a decrease when it comes to the next few quarters. Having said that, I would say, Andrew, if you look sequentially, we are consistent. We have raised, if you look at Q3 and Q4 EPS guidance, stay has been raised and stay at elevated level. For a full year, which is going to be pretty much outstanding. There is, of course, also the MT top line seasonality that happens in Q4, with the market going on, in most of the cases, the customers tend to shut down early in December.

Speaker #1: Having said that , I would say , Andrew , if you look at sequentially , we are consistent . So we have raised if you look at Q3 and Q4 , EPS guidance , stay has been raised and stay at elevated level .

Speaker #1: And for a full year , which is going to be pretty much a outstanding . And there is , of course , also the empty top line seasonality that happens in Q4 .

Speaker #1: You know , with the market going on in most of the cases , the customer tend to shut down , you know , early in December

Speaker #14: Excellent . Thanks so much

Andrew Obin: Excellent. Thanks so much.

Speaker #13: Thank you

Luca Savi: Thank you.

Speaker #3: Once again , if you do have a question , you may press star one one on your touchtone phone at this time . Our next question comes from Joe Ritchie at Goldman Sachs .

Operator: Once again, if you do have a question, you may press star one one on your touchtone phone at this time. Our next question comes from Joe Ritchie at Goldman Sachs.

Speaker #15: Hi , Joe . Hey , guys . Good morning . , Luca , your 80/20 comments had me laughing earlier . So , , I always thought of you guys as the 95 company .

Luca Savi: Hi, Joe.

Joe Ritchie: Hey, guys. Good morning. Luca, your 80/20 comments had me laughing earlier. I always thought of you guys as the 95/5 company. 5% proud, 95% never satisfied.

Speaker #15: You know , 5% , 95% , never satisfied . , but , .

Speaker #1: That's true .

Luca Savi: That's true.

Speaker #15: But yeah , so , so , but here , look , the , , just really exceptional performance across the board . , and incredible that you guys have been able to do all of this M&A delever faster than expected .

Joe Ritchie: Yeah. Look, this really exceptional performance across the board, and incredible that you guys have been able to do all of this M&A, delever faster than expected. The M&A seems to be really paying dividends for you guys. Maybe let's spend a minute just discussing what the pipeline looks like, where the opportunities are from here, how you're thinking about potentially deploying future capital. Obviously, it's been a great way for you guys to compound over the last few years.

Speaker #15: , and the M&A seems to be really paying dividends for you guys . So maybe let's , let's spend a minute just discussing like what the pipeline looks like , where the opportunities are from here , how you're thinking about potentially deploying future capital .

Speaker #15: , obviously , it's been a great way for you guys to compound over the last few years

Speaker #13: Sure .

Luca Savi: Sure. Everything is working well. As you can imagine, Joe, we're very busy cultivating the right company. The fact that we are delevering faster gives a little bit more flexibility. Our priorities have not really changed. The priorities today is really to pay down the debt, like Mike said in the prepared remarks, is really to execute on the synergies and deliver on SPX FLOW. Of course, there might be some bolt-on acquisitions that we're cultivating, and this goes across in Flow as well as on the Connector side of the business. You have seen Aerospace, a very small contact, a very small acquisition, but very strategic. Small bolt-ons are in the pipeline and might be executed. We are definitely busy cultivating as well as paying down debt and delivering the synergies.

Speaker #1: So , , you know , it's , , it's a , it's , everything is working . It's working well . So as you can imagine , Joe , we are , , we're very busy cultivating , cultivating the right companies .

Speaker #1: So the fact that we are delivering , , faster , , gives us a little bit more flexibility , but let's not , , our priorities have not really changed .

Speaker #1: So the priorities today is really to pay down the debt . Like Mike said in a prepared remarks , is really to , , execute on the synergies and deliver on SPX flow .

Speaker #1: Of course , there might be some bolt on acquisitions that we're cultivating . And this goes across in flow as well as on the on the connector side of the business .

Speaker #1: You've seen aerospace , a very small contacts , a very small acquisition , but very strategic . So small small towns are in the pipeline and then my and might be executed .

Speaker #1: But we are definitely busy . , cultivating as well as paying down debt and delivering the synergies

Speaker #15: Okay , great to hear . And then I guess I may have missed it . Earlier when you talked about the orders and then specifically , you know , what you're seeing across your portfolio .

Joe Ritchie: Okay, great to hear. I guess, I may have missed it earlier, when you talked about the kSARIA orders and specifically, what you're seeing across your portfolio. I'm curious, is the mix of your business shifting at all to maybe a little bit longer cycle than it has been historically? Maybe comment on that. You're booking these orders on longer term platforms. I'm just curious, how you're thinking about the maybe more visibility beyond just 2026.

Speaker #15: I'm curious is like the mix of your business shifting at all to , to maybe a little bit longer cycle , , than it has been historically , maybe comment on that .

Speaker #15: , because you're booking these orders on like longer term platforms . I'm just curious , like , how you're thinking about that maybe more visibility beyond just like 2026 .

Speaker #13: I think .

Luca Savi: I think that's a very fair point, Joe. I would say is we are lucky to have it both. What I mean by that is, kSARIA is winning important platforms, and you have the visibility for 2028. If you look at jet programs, we are winning our fair share and more because we're winning market share. You have that. When you look at the backlog, because every quarter, we look at the backlog for the next 4 quarters, and we compare to the backlog that we had 1 year ago for the future growth at that time. I can tell you that our backlog that we have in our hands for the next 2 quarters are considerably higher.

Speaker #1: That's a very fair point , Joe . But I would say is that we are lucky to have to have it both . And what I mean by that is , , Kesaria is winning important platforms and you have the visibility for 28 .

Speaker #1: So if you look at jet programs , so we are winning our fair share and more because we're winning market share . You have that .

Speaker #1: But when you look at the backlog , because , you know , every quarter we look at the backlog for the next four quarters and we compare to the backlog that we had one year ago for the future growth at that time .

Speaker #1: And I can tell you that we our backlog that we have in our hands for the next few quarters is considerably higher . So , , for the next quarter , sometimes the backlog is higher by 30% , to quarter .

Luca Savi: For the next quarter, sometimes the backlog is higher by 30%. 2 quarters that allow by 20%, and for the next year is already 20% higher than what it was 1 year ago. You got great visibility in the long term, but also much more backlog for the short term.

Speaker #1: That allowed by 20% . And for the next year is already 20% higher than what it was one year ago . So you got great visibility in the long term , but also much more backlog for the short for the short term

Speaker #15: Perfect . Thank you

Joe Ritchie: Perfect. Thank you.

Speaker #13: Thank you Joe .

Luca Savi: Thank you, Joe.

Speaker #3: Thank you . This does conclude today's teleconference . Please disconnect your lines at this time and have a wonderful day .

Operator: Thank you. This does conclude today's teleconference. Please disconnect your lines at this time and have a wonderful day.

Luca Savi: Thank you.

Q2 2026 ITT Inc Earnings Call

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