AMETEK, Inc. (NYSE:AME) Q4 2022 Earnings Call Transcript

And we’re pretty optimistic for it in the second-half. But that’s the picture in Q4, really strong broad-based growth, strongest Europe, and second U.S. Most of Asia was really good, and in China there was some weakness. Okay, and the second question was in market segment’s summery. I’ll take a walk around the company. In our process area, our overall process businesses, they were up high-single digits in the quarter. Organic sales were up 10%, and you also had the contributions from the acquisition of Navitar and it was offset by foreign currency headwinds. And as we saw throughout last year, growth across our process businesses was particularly — was broad-based, but it was particularly strong in our Ultra Precision Technologies businesses in the quarter.

And as we look ahead to 2023, we expect organic sales for process businesses to be up mid-single digits for the year. Next I’ll talk about Aerospace & Defense. Our Aerospace & Defense businesses had a very strong finish to the year, and with overall and organic sales up mid teens. So, that was the strongest growth rate of the year for Aerospace & Defense. Our commercial businesses led the growth in the quarter. We had sales of high teens on a percentage business in the commercial business. And Defense was also strong in the quarter, growing low double digits. And for all of 2023, we expect organic sales for our Aerospace & Defense businesses to be up mid-to-high single digits, with commercial aerospace growth expected to be modestly stronger than defense growth.

I’ll next go to our Power & Industrial, overall sales for our Power & Industrial businesses were up high single digits in the fourth quarter, driven by mid single-digit organic growth and the contributions from the acquisition of RTDS. Growth in the quarter was particularly strong across our programmable power business. For all of 2023, we expect organic sales for our Power & Industrial business to be up mid single digits, with similar growth across both the Power & Industrials segments. And finally, I’ll talk about our Automation & Engineered Solutions market segment. And overall sales were up low single digits in the fourth quarter, with very solid mid single-digit organic sales growth, had some currency headwind in that segment. I was very pleased with the overall growth and the performance of Automation & Engineered Solutions in 2022.

They’re continuing to expand exposures in attractive niche markets. And in particular, our Engineered Medical Components business saw strong growth in the quarter. And in 2023, we expect organic sales for our Automation & Engineered Solutions businesses to be up mid single digits, with similar growth expected across both our Automation and Engineered Solutions business. That’s a walk around the company. Deane, do you have any more questions?

Deane Dray: Yes, just as a follow-up, just how would you characterize the pace of orders, industrial demand, the size of orders, is there — just with respect to how normalization might be happening for AMETEK’s businesses?

Dave Zapico: That’s a great question, Deane. Our overall orders were up 1.5% in the quarter. And the overall demand environment, as I answered Allison’s questions, feels really solid. We had our 10th straight positive book-to-bill quarter. And we ended with an all-time record backlog as I mentioned in the prepared remarks. And this level of backlog, as I said, was 50% of our annual sales, well above the normal level of 30%. And it’s up 78% from the end of 2020. So, we’re in a really strong position as we enter 2023. So, your question on some of the nuances, if you recall, over the last couple of earnings calls, we highlighted a couple of dynamics that would impact our order growth. But the first was the difficult comparisons we’re facing because as orders have been strong for an extended period of time.