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    Sabrina Abrams • Bank of America

    Sabrina Abrams's questions to Applied Industrial Technologies Inc (AIT) leadership

    Sabrina Abrams's questions to Applied Industrial Technologies Inc (AIT) leadership • Q4 2025

    Question

    Sabrina Abrams from Bank of America requested the specific dollar contribution of Hydrodyne to EBITDA in the quarter and asked for the amount of LIFO expense embedded in the fiscal 2026 guidance.

    Answer

    CFO David Wells disclosed that Hydrodyne contributed just over $7 million of EBITDA in Q4, resulting in approximately $0.03 of EPS contribution, and the company is on track to meet its $0.15 accretive EPS goal for the first twelve months. For fiscal 2026, Wells stated the guidance embeds $14 million to $18 million in LIFO expense. President & CEO Neil Schrimsher added that at the guidance midpoint, incremental margins are expected in the low teens, but would be in the high teens excluding M&A mix and LIFO.

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    Sabrina Abrams's questions to Applied Industrial Technologies Inc (AIT) leadership • Q3 2025

    Question

    Sabrina Abrams of Bank of America questioned why the Q4 guidance implies a deceleration despite positive sequential trends and strong orders. She also sought clarification on the drivers behind the expected increase in SG&A and margin deleveraging in the fourth quarter.

    Answer

    President and CEO Neil Schrimsher described the Q4 guidance as 'appropriately prudent' given macro uncertainty from tariffs, and noted that longer-cycle Engineered Solutions orders will benefit fiscal 2026 more directly. CFO David Wells attributed the Q4 margin pressure to several factors: the higher SG&A structure of the newly acquired Hydradyne, and a difficult year-over-year comparison due to a LIFO liquidation benefit in the prior-year Q4, which creates a 20 basis point headwind.

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    Sabrina Abrams's questions to Applied Industrial Technologies Inc (AIT) leadership • Q2 2025

    Question

    Sabrina Abrams asked about supplier pricing behavior, whether price/cost has normalized, and for a more detailed explanation for the expected sequential moderation in gross margins from Q2 to Q3.

    Answer

    President and CEO Neil Schrimsher confirmed there are no signs of disinflation, with supplier price increases becoming more normalized in frequency and size. CFO David Wells explained the sequential gross margin moderation is due to the non-recurrence of a supplier rebate and an expected step-up in LIFO expense as inventory levels normalize. He also noted the lower LIFO in Q2 was a function of inventory reduction, not lower price inputs.

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    Sabrina Abrams's questions to Applied Industrial Technologies Inc (AIT) leadership • Q1 2025

    Question

    Sabrina Abrams asked about Applied's inventory strategy and whether any customers are still destocking. She also questioned why Q1 EBITDA margins were slightly below expectations and what drove the variance.

    Answer

    President and CEO Neil Schrimsher stated that Applied is not pulling back on its own inventories and is investing to be prepared for demand. He noted that customer destocking is largely over, with some lingering effects only in the off-highway mobile segment. Regarding margins, Schrimsher and CFO David Wells explained the result was largely in line with internal plans, attributing the slight dip to the timing of sales within the quarter, conscious investment in growth initiatives, and a tough year-over-year comparison in gross margin, as the prior year's Q1 benefited from vendor rebate anomalies.

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    Sabrina Abrams's questions to WW Grainger Inc (GWW) leadership

    Sabrina Abrams's questions to WW Grainger Inc (GWW) leadership • Q2 2025

    Question

    Sabrina Abrams of Bank of America asked about the discrepancy between Grainger's reported pricing and broader government inflation data for wholesalers, and also inquired about the demand cadence during the quarter.

    Answer

    CEO D.G. Macpherson suggested that Grainger's scale may allow it to incur fewer cost increases than smaller peers, and noted that Grainger's pricing will increase to a 3-4% run rate by year-end. He characterized the overall demand environment as 'relatively muted' but confirmed that the company achieved solid volume share gain during the quarter.

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    Sabrina Abrams's questions to WW Grainger Inc (GWW) leadership • Q2 2025

    Question

    Sabrina Abrams questioned the difference between government wholesale inflation data and Grainger's reported pricing, and asked for color on the demand cadence during the quarter.

    Answer

    CEO D.G. Macpherson suggested Grainger's scale may allow it to incur lower cost increases than others, noting its pricing will eventually reach a 3-4% run rate. He characterized the demand environment as relatively muted but stated that Grainger is performing reasonably well, with solid volume share gain in the quarter and into July.

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    Sabrina Abrams's questions to WW Grainger Inc (GWW) leadership • Q1 2025

    Question

    Sabrina Abrams asked for clarification on how to reconcile the modest 1-1.5% net price impact with the potentially much larger impact implied by high tariffs on Chinese imports. She also requested more color on the expected cadence of price/cost dynamics throughout the year.

    Answer

    Chairman and CEO D.G. Macpherson explained the 1-1.5% impact is small because the initial price actions were limited to a smaller portion of their products, primarily direct imports, and did not contemplate the most severe reciprocal tariffs. SVP and CFO Dee Merriwether added that price/cost dynamics are noisy, but the company is targeting a Q2 operating margin near 15% and will manage toward price/cost neutrality over time, though timing differences may occur.

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    Sabrina Abrams's questions to WW Grainger Inc (GWW) leadership • Q4 2024

    Question

    Sabrina Abrams questioned if the shift to a volume-based outgrowth target alters long-term margin or EPS targets. She also asked for the drivers behind the expected margin ramp throughout 2025, starting from a low point in Q1.

    Answer

    CEO D.G. Macpherson confirmed there are no changes to the company's long-term financial targets or its earnings algorithm. CFO Dee Merriwether explained the Q1 margin pressure is due to a slow sales start, FX headwinds, and one fewer selling day, leading to an operating margin near the low end of the annual guidance range (~15%). She noted margins will ramp from there as sales volume recovers through the year.

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    Sabrina Abrams's questions to WW Grainger Inc (GWW) leadership • Q3 2024

    Question

    Sabrina Abrams inquired about the traction of self-help initiatives for gaining share in the High-Touch Solutions (HTS) segment and the outlook for market outgrowth in 2025. She also asked if further pricing actions are needed given the neutral price-cost spread.

    Answer

    Chairman and CEO D.G. Macpherson highlighted strong returns from leveraging proprietary data for marketing and seller coverage. SVP and CFO Dee Merriwether reiterated the 400-500 basis point average outgrowth target, despite current measurement noise. On pricing, she noted a September increase helped achieve a neutral price-cost spread for the year-end and that the company's philosophy is to pass on inflation.

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    Sabrina Abrams's questions to ITT Inc (ITT) leadership

    Sabrina Abrams's questions to ITT Inc (ITT) leadership • Q2 2025

    Question

    Sabrina Abrams asked for the rationale behind trimming the high end of the full-year margin guidance and for clarity on the Q3 to Q4 margin cadence. She also pointed to the strong core incremental margins in CCT and asked what is driving such excellent execution.

    Answer

    CFO Emmanuel Caprais attributed the minor guidance adjustment to higher M&A costs and an unfavorable mix from the fast-growing but still dilutive Svanohoi acquisition. For CCT's strong performance, he credited significant pricing actions, which added 450 basis points of margin improvement, and productivity gains from new automation projects at key facilities, leading to a core CCT margin of 21.5%.

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    Sabrina Abrams's questions to ITT Inc (ITT) leadership • Q1 2025

    Question

    Sabrina Abrams of Bank of America Corporation asked for clarification on the tariff impact timeline and the price/volume mix in the organic growth guidance, and also inquired about trends in the CCT distribution business.

    Answer

    CFO Emmanuel Caprais confirmed the $50-$60 million tariff impact is for the remaining nine months of 2025 and is expected to be fully offset, with pricing contributing about 2 points to the full-year organic growth guidance. CEO Luca Savi noted that while CCT distribution orders were down year-over-year, they grew 20% sequentially and remain at a high level, indicating a positive overall picture.

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    Sabrina Abrams's questions to Illinois Tool Works Inc (ITW) leadership

    Sabrina Abrams's questions to Illinois Tool Works Inc (ITW) leadership • Q2 2025

    Question

    Sabrina Abrams from Bank of America requested clarification on the cadence of restructuring costs for the year and asked for the updated full-year outlook for Product Line Simplification (PLS).

    Answer

    Senior VP & CFO Michael Larsen clarified that restructuring spend was $20 million in the first half, with another $20 million expected in the second half, making the full-year impact flat year-over-year. He also confirmed that the outlook for PLS is unchanged, projecting it will remain a one-percentage-point headwind to the organic growth rate for the full year.

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    Sabrina Abrams's questions to Illinois Tool Works Inc (ITW) leadership • Q3 2024

    Question

    Sabrina Abrams followed up on the Customer-Backed Innovation (CBI) framework, asking if ITW is on track for its long-term contribution targets and which segments are most mature. She also asked if the completion of major divestitures increases the company's appetite for M&A.

    Answer

    CEO Chris O'Herlihy confirmed ITW is on track to achieve 3%+ CBI contribution by 2030, highlighting Welding, Test & Measurement, Food Equipment, and Automotive as segments showing strong progress. Regarding M&A, he stated their disciplined posture hasn't changed; they remain focused on high-quality acquisitions that meet strict criteria for growth, margin leverage, and valuation, using the successful MTS acquisition as a prime example.

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