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    ESAB (ESAB)

    Q1 2024 Earnings Summary

    Reported on Mar 19, 2025 (Before Market Open)
    Pre-Earnings Price$105.88Last close (Apr 30, 2024)
    Post-Earnings Price$107.48Open (May 1, 2024)
    Price Change
    $1.60(+1.51%)

    What went wrong

    • ESAB's pricing gains are primarily in the Americas region, with EMEA and APAC experiencing negative pricing pressures. This disparity may impact global margins if pricing pressures continue outside the Americas. ,
    • Filler metal sales are remaining stable without significant growth, potentially indicating stagnation in this core segment of ESAB's business. ,
    • The recent acquisitions of Sager ($10 million in revenue) and SUMIG ($30 million in revenue) are relatively small and may not significantly impact ESAB's overall growth. Relying on small acquisitions for growth may not move the needle substantially. ,

    Q&A Summary

    1. Acquisition Impacts
      Q: What sales and EPS accretion will Sager and SUMIG bring?
      A: Sager is expected to contribute around $10 million in revenue this year and is included in our guidance. SUMIG generated approximately $30 million in revenue over the last 12 months; although it's not yet in our guidance as we expect the deal to close in the second half of 2024. Both acquisitions will be EBITDA accretive and EPS accretive in their first year.

    2. Growth Outperformance
      Q: How are you outgrowing peers across regions?
      A: We achieved strong performance in both the Americas and the rest of the world. This outgrowth is driven by our expanded equipment portfolio, which has generated significant excitement among distributors. Additionally, our standardized sales planning process has contributed to share gains across all regions.

    3. Pricing Outlook
      Q: What's driving pricing differences and expectations ahead?
      A: In the Americas, we're seeing positive pricing due to both value pricing and inflation-based strategies. In EMEA and APAC, we're focused on net price management. We expect low single-digit price increases overall, with stronger pricing in the Americas and less in other regions as the year progresses.

    4. AI Integration
      Q: How are you using AI operationally?
      A: We're leveraging AI in two areas: commercial growth and operating excellence. In operating excellence, AI assists with material planning and production planning, creating cost advantages over time. On the commercial side, AI helps drive efficiencies for our sales personnel. We're utilizing external providers to implement these AI solutions.

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