Patrick Schuchard

Patrick Schuchard inquired about the drivers of automation growth within Engineered Solutions, an update on cross-selling initiatives, and the implications of the Q2 sales guide given positive book-to-bill.

Answer

President and CEO Neil Schrimsher attributed automation growth to a combination of serving more industrial customers, participating in traditional industry projects, and general robotics market growth, highlighting collaborative/autonomous mobile robots and vision offerings. He characterized cross-selling as still in early innings, with growing funnels and expanding project opportunities. Director of Investor Relations and Treasury Ryan Cieslak stated the Q2 top-line guide is consistent with prior expectations, reflecting a choppy near-term environment, slower seasonality, holiday timing, and back-half weighted backlog conversion for Engineered Solutions.

Patrick Schuchard inquired about the drivers of automation growth in Engineered Solutions (secular market vs. internal initiatives/market share), an update on cross-selling as an organic driver, and the implications of the Q2 top-line guide compared to normal seasonality.

Answer

Neil Schrimsher, President and CEO, attributed automation growth to a combination of opening more industrial customer opportunities, participating in projects, and general market growth in robotics and vision, indicating strong positioning. He characterized cross-selling as still in 'early innings' with growing funnels and expanding project opportunities. Ryan Cieslak, Director of Investor Relations and Treasury, clarified that the Q2 top-line guide is consistent with August's initial guidance, reflecting a choppy near-term environment and back-half weighted backlog conversion, not a change in outlook.

Patrick Schuchard asked for the history and strategic rationale behind the Hydradyne acquisition and inquired about the current strategic focus of the M&A pipeline, such as whether it prioritizes fluid power or other areas.

Answer

President and CEO Neil Schrimsher described Hydradyne as a long-known, attractive target due to its strong geographic fit in the southern U.S. and its complementary value-added solutions. He confirmed the M&A pipeline remains active with targets across fluid power, flow control, and automation, supported by a strong balance sheet with pro forma net leverage at a modest 0.5x post-acquisition.