PART I [ITEM 1. Business](index=4&type=section&id=ITEM%201.%20Business) nVent Electric plc provides global electrical connection and protection solutions across three segments, driven by strategic acquisitions - nVent Electric plc is a leading global provider of electrical connection and protection solutions, offering enclosures, electrical fastening, and thermal management solutions[17](index=17&type=chunk)[158](index=158&type=chunk) - The company operates across three segments: Enclosures, Electrical & Fastening Solutions, and Thermal Management, which represented approximately **49%**, **33%**, and **18% of total revenues during 2023**, respectively[26](index=26&type=chunk)[159](index=159&type=chunk) - In 2023, nVent completed the acquisition of ECM Industries for approximately **$1.1 billion in cash**, enhancing its Electrical & Fastening Solutions segment. Additionally, it acquired TEXA Industries for **$34.8 million**, adding industrial cooling applications to its Enclosures segment[23](index=23&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk) Workforce Diversity as of December 31, 2023 (excluding 2023 acquisitions and direct field labor) | Category | Percent of Executive Leadership | Percent of Management | Percent of All Other Employees | | :--------- | :------------------------------ | :-------------------- | :----------------------------- | | Racially diverse (U.S. only) | 14% | 21% | 44% | | Women (Global) | 38% | 27% | 26% | Backlog of Orders by Segment (in millions USD) | Segment | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | $ Change (millions USD) | % Change | | :-------------------------- | :------------------ | :------------------ | :------- | :------- | | Enclosures | $373.1 | $361.9 | $11.2 | 3.1% | | Electrical & Fastening Solutions | $89.7 | $78.7 | $11.0 | 14.0% | | Thermal Management | $176.3 | $166.7 | $9.6 | 5.8% | | **Total** | **$639.1** | **$607.3** | **$31.8** | **5.2%** | [ITEM 1A. Risk Factors](index=10&type=section&id=ITEM%201A.%20Risk%20Factors) The company faces diverse risks including global economic conditions, competition, acquisition integration, supply chain, and international operations - Global economic and business conditions, including inflation, slowing growth, and geopolitical instability, can negatively impact demand for products and financial performance[68](index=68&type=chunk)[69](index=69&type=chunk) - The company operates in highly competitive markets, facing pressure on profit margins and requiring continuous product differentiation and strong distribution networks[36](index=36&type=chunk)[37](index=37&type=chunk)[70](index=70&type=chunk) - Acquisitions, including the recent ECM Industries acquisition, involve significant risks such as diversion of management attention, integration difficulties, potential loss of key personnel/customers, assumption of liabilities, and dilution of shareholder interests[72](index=72&type=chunk)[73](index=73&type=chunk)[85](index=85&type=chunk) - Supply chain disruptions, material cost inflation (raw materials, logistics, labor, energy), and the ability to pass on price increases remain significant challenges[75](index=75&type=chunk)[76](index=76&type=chunk) - Operating a multinational business (**34% of 2023 net sales from outside U.S.**) exposes the company to political, regulatory, economic, and currency exchange rate risks[80](index=80&type=chunk)[81](index=81&type=chunk)[106](index=106&type=chunk) - Increased debt from the ECM Industries acquisition (**$900 million new indebtedness**) raises cash requirements for interest payments, increases vulnerability to adverse economic changes, and may limit future financing flexibility[104](index=104&type=chunk)[105](index=105&type=chunk) - Changes in tax laws (e.g., Pillar II global minimum tax regime) and potential changes in tax residency could negatively impact the effective tax rate and future profitability[111](index=111&type=chunk)[116](index=116&type=chunk) - Cybersecurity threats are increasing in frequency and sophistication, posing risks to systems, networks, products, and services, potentially leading to regulatory, financial, and reputational damage[100](index=100&type=chunk)[101](index=101&type=chunk) [ITEM 1B. Unresolved Staff Comments](index=21&type=section&id=ITEM%201B.%20Unresolved%20Staff%20Comments) The company reported no unresolved staff comments from the SEC - There are no unresolved staff comments[127](index=127&type=chunk) [ITEM 1C. Cybersecurity](index=21&type=section&id=ITEM%201C.%20Cybersecurity) nVent implements a comprehensive cybersecurity program aligned with NIST and zero trust, overseen by the Board, covering risk management and safeguards - nVent's cybersecurity program is comprehensive, aligned with NIST Cybersecurity Framework and zero trust model, incorporating industry best practices[128](index=128&type=chunk) - The Board of Directors, supported by the Audit Committee, oversees cybersecurity risk management, receiving periodic reports from the CTO and CISO[129](index=129&type=chunk)[130](index=130&type=chunk) - Key program capabilities include enterprise-wide risk management, technical safeguards (firewalls, intrusion systems, anti-malware), incident response and recovery planning, third-party risk management, and employee education and awareness[131](index=131&type=chunk)[132](index=132&type=chunk)[133](index=133&type=chunk)[134](index=134&type=chunk)[135](index=135&type=chunk) - Previous cybersecurity incidents have not materially affected the company's business strategy, results of operations, or financial condition, but future risks remain[136](index=136&type=chunk) [ITEM 2. Properties](index=22&type=section&id=ITEM%202.%20Properties) nVent's principal office is in London, U.K., with global manufacturing and distribution facilities deemed suitable - Principal office is in London, U.K. (leased), and U.S. management office is in Minneapolis, Minnesota (leased)[137](index=137&type=chunk) Principal Manufacturing, Distribution, and Service Center Properties | Segment | Locations | Manufacturing Plants | Distribution Facilities | Service Centers | | :-------------------------- | :---------------------- | :------------------- | :---------------------- | :-------------- | | Enclosures | U.S. and 10 other countries | 19 | 16 | — | | Electrical & Fastening Solutions | U.S. and 4 other countries | 17 | 8 | — | | Thermal Management | U.S. and 3 other countries | 4 | 3 | 4 | [ITEM 3. Legal Proceedings](index=23&type=section&id=ITEM%203.%20Legal%20Proceedings) nVent is involved in various legal actions, including commercial, product liability, and environmental matters, with material impact deemed unlikely - nVent is party to various legal actions, including commercial disputes, product liability, asbestos, environmental, safety and health, patent infringement, and employment matters[138](index=138&type=chunk) - Management believes a material impact on financial position, results of operations, or cash flows from current claims is unlikely, but acknowledges the remote possibility of future adverse rulings[139](index=139&type=chunk) - Environmental liabilities are accrued on a site-by-site basis when probable and estimable, with current reserves not material as of December 31, 2023[141](index=141&type=chunk) - Product liability claims incurred after the 2018 separation are insured and accrued for by Tonka Bay, nVent's captive insurance subsidiary[142](index=142&type=chunk) [ITEM 4. Mine Safety Disclosures](index=23&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable - This item is not applicable[143](index=143&type=chunk) PART II [ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=26&type=section&id=ITEM%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) nVent's ordinary shares trade on the NYSE, showing strong shareholder returns and an active share repurchase program - nVent's ordinary shares trade on the New York Stock Exchange under the symbol "NVT"[148](index=148&type=chunk) - As of December 31, 2023, there were **12,426 shareholders of record**[148](index=148&type=chunk) Indexed Returns (Years ended December 31) | Company / Index | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | | :-------------------------- | :--- | :--- | :--- | :--- | :--- | :--- | | nVent Electric plc | $100 | $120.75 | $113.90 | $190.38 | $196.71 | $306.82 | | S&P Mid Cap 400 Index | $100 | $113.38 | $128.87 | $160.77 | $139.78 | $162.75 | | S&P Mid Cap 400 Industrials Index | $100 | $121.40 | $141.42 | $181.65 | $160.76 | $211.30 | - The Board authorized a **$300.0 million** share repurchase program (2021 Authorization) expiring July 22, 2024[155](index=155&type=chunk)[205](index=205&type=chunk) Share Repurchases (Fourth Quarter 2023) | Period | Total Shares Purchased | Average Price Paid per Share | Total Shares Purchased (Publicly Announced Plans) | Dollar Value Remaining (Publicly Announced Plans) | | :------------------------ | :--------------------- | :--------------------------- | :---------------------------------------------- | :---------------------------------------------- | | October 1 – October 28, 2023 | 1,086 | $52.04 | — | $127,333,026 | | October 29 – November 25, 2023 | 605,964 | $51.49 | 605,726 | $96,133,146 | | November 26 – December 31, 2023 | 269,607 | $53.79 | 267,401 | $81,754,255 | | **Total** | **876,657** | | **873,127** | | - As of December 31, 2023, **$81.8 million** remained available for share repurchases under the 2021 Authorization[155](index=155&type=chunk)[206](index=206&type=chunk) [ITEM 6. Reserved](index=27&type=section&id=ITEM%206.%20Reserved) This item is reserved and contains no information - This item is reserved[154](index=154&type=chunk) [ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=ITEM%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section reviews nVent's 2023 financial performance, highlighting net sales and income growth, improved gross profit, strong liquidity, and critical accounting estimates - nVent is a global provider of electrical connection and protection solutions, operating in Enclosures, Electrical & Fastening Solutions, and Thermal Management segments[158](index=158&type=chunk)[159](index=159&type=chunk) - Key trends include the converging megatrends of electrification, sustainability, and digitalization (including AI), driving sales growth, particularly in infrastructure and data solutions[163](index=163&type=chunk) - Operating objectives for 2024 include executing ESG strategy, enhancing employee engagement, achieving differentiated revenue growth through innovation and vertical expansion, integrating acquisitions, optimizing technological capabilities, driving operational excellence, optimizing working capital, and strategically deploying capital[163](index=163&type=chunk)[164](index=164&type=chunk) [Forward-looking statements](index=28&type=section&id=Forward-looking%20statements) The report contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ - The report contains forward-looking statements subject to risks, uncertainties, and assumptions that could cause actual results to differ materially[156](index=156&type=chunk) - Factors include global economic conditions, restructuring benefits, acquisition integration, competition, currency volatility, supply chain risks, and regulatory changes[156](index=156&type=chunk) [Overview](index=28&type=section&id=Overview) nVent is a leading global provider of electrical connection and protection solutions across three segments - nVent is a leading global provider of electrical connection and protection solutions, with operations classified into three segments: Enclosures, Electrical & Fastening Solutions, and Thermal Management[158](index=158&type=chunk)[159](index=159&type=chunk) - In 2023, the company acquired ECM Industries for approximately **$1.1 billion** and TEXA Industries for **$34.8 million**, expanding its Electrical & Fastening Solutions and Enclosures segments, respectively[161](index=161&type=chunk)[162](index=162&type=chunk) [Key Trends and Uncertainties Regarding our Existing Business](index=29&type=section&id=Key%20Trends%20and%20Uncertainties%20Regarding%20our%20Existing%20Business) Key trends include ongoing inflation, Russia exit, Pillar II tax impact, and megatrends driving growth, with 2024 objectives focused on ESG, growth, and operational excellence - Ongoing inflationary increases, primarily in labor costs, are expected to continue into 2024, potentially impacting results despite pricing actions and productivity improvements[163](index=163&type=chunk) - The company is exiting business operations in Russia due to the conflict with Ukraine, with potential for broader economic disruption[163](index=163&type=chunk) - The Pillar II global minimum tax regime, effective from January 1, 2024, is expected to negatively impact the effective tax rate[163](index=163&type=chunk) - Megatrends of electrification, sustainability, and digitalization (including AI) are driving sales growth, particularly in infrastructure and data solutions, expected to continue in 2024[163](index=163&type=chunk) - Operating objectives for 2024 include executing ESG strategy, enhancing employee engagement, achieving differentiated revenue growth, integrating acquisitions, optimizing technology, driving operational excellence, optimizing working capital, and strategic capital deployment[163](index=163&type=chunk)[164](index=164&type=chunk) [Consolidated Results of Operations](index=31&type=section&id=Consolidated%20Results%20of%20Operations) This section details nVent's consolidated financial performance, including net sales, gross profit, operating income, and net income, with key drivers Consolidated Results of Operations (in millions USD, except percentages) | Metric | 2023 (millions USD) | 2022 (millions USD) | % / point change (2023 vs 2022) | | :---------------------------------- | :------- | :------- | :------------------------------ | | Net sales | $3,263.6 | $2,909.0 | 12.2% | | Cost of goods sold | $1,921.5 | $1,812.3 | 6.0% | | Gross profit | $1,342.1 | $1,096.7 | 22.4% | | Gross profit % of net sales | 41.1% | 37.7% | 3.4 pts | | Selling, general and administrative | $683.2 | $595.9 | 14.7% | | SG&A % of net sales | 20.9% | 20.5% | 0.4 pts | | Research and development | $71.5 | $60.4 | 18.4% | | R&D % of net sales | 2.2% | 2.1% | 0.1 pts | | Operating income | $587.4 | $440.4 | 33.4% | | Operating income % of net sales | 18.0% | 15.1% | 2.9 pts | | Net interest expense | $79.4 | $31.2 | N.M. | | Gain on sale of investment | $(10.3) | — | N.M. | | Other expense (income) | $18.8 | $(63.4) | N.M. | | Income before income taxes | $499.5 | $472.6 | 5.7% | | Provision (benefit) for income taxes | $(67.6) | $72.8 | N.M. | | Effective tax rate | (13.5)% | 15.4% | (28.9) pts | | Net income | $567.1 | $399.8 | 41.8% | - Net sales increased by **12.2% in 2023**, driven by **8.7% from acquisitions** (ECM Industries and TEXA Industries) and **3.5% organic growth** (primarily from infrastructure business and selective price increases)[166](index=166&type=chunk) - Gross profit as a percentage of net sales increased by **3.4 percentage points**, primarily due to increases in selling prices to mitigate inflationary costs and increased productivity[167](index=167&type=chunk) - Net interest expense increased significantly due to increased debt from the ECM Industries acquisition and higher variable interest rates[169](index=169&type=chunk) - The effective tax rate decreased by **28.9 percentage points**, primarily due to non-cash benefits from deferred tax assets related to intangible assets in Switzerland (**$72.0 million**) and tax-deductible statutory losses in Luxembourg (**$93.2 million**)[171](index=171&type=chunk)[174](index=174&type=chunk) [Segment Results of Operations](index=32&type=section&id=Segment%20Results%20of%20Operations) This section analyzes the financial performance of nVent's three segments: Enclosures, Electrical & Fastening Solutions, and Thermal Management - Segment income represents operating income exclusive of intangible amortization, acquisition-related expenses, restructuring costs, impairments, and other unusual non-operating items[173](index=173&type=chunk) Enclosures Segment Performance (in millions USD, except percentages) | Metric | 2023 (millions USD) | 2022 (millions USD) | % / point change (2023 vs 2022) | | :------------- | :------- | :------- | :------------------------------ | | Net sales | $1,605.9 | $1,503.7 | 6.8% | | Segment income | $346.6 | $256.0 | 35.4% | | % of net sales | 21.6% | 17.0% | 4.6 pts | - Enclosures net sales increased by **6.8%**, driven by **5.9% organic growth** (infrastructure, industrial, commercial & residential businesses, and price increases) and **0.8% from the TEXA Industries acquisition**[176](index=176&type=chunk)[177](index=177&type=chunk) - Enclosures segment income as a percentage of net sales increased by **4.6 percentage points**, primarily due to higher selling prices and increased productivity, partially offset by inflationary labor costs and growth investments[176](index=176&type=chunk)[178](index=178&type=chunk) Electrical & Fastening Solutions Segment Performance (in millions USD, except percentages) | Metric | 2023 (millions USD) | 2022 (millions USD) | % / point change (2023 vs 2022) | | :------------- | :------- | :------- | :------------------------------ | | Net sales | $1,063.0 | $791.4 | 34.3% | | Segment income | $330.6 | $219.9 | 50.3% | | % of net sales | 31.1% | 27.8% | 3.3 pts | - Electrical & Fastening Solutions net sales increased by **34.3%**, driven by **30.4% from the ECM Industries acquisition** and **3.6% organic growth** (infrastructure and commercial & residential businesses, and price increases)[180](index=180&type=chunk)[181](index=181&type=chunk) - Electrical & Fastening Solutions segment income as a percentage of net sales increased by **3.3 percentage points**, primarily due to higher selling prices, increased productivity, and favorable product mix, partially offset by inflationary labor costs and lower sales volume[180](index=180&type=chunk)[182](index=182&type=chunk) Thermal Management Segment Performance (in millions USD, except percentages) | Metric | 2023 (millions USD) | 2022 (millions USD) | % / point change (2023 vs 2022) | | :------------- | :------- | :------- | :------------------------------ | | Net sales | $594.7 | $613.9 | (3.1)% | | Segment income | $138.5 | $140.8 | (1.6)% | | % of net sales | 23.3% | 22.9% | 0.4 pts | - Thermal Management net sales decreased by **3.1%**, primarily due to organic sales declines in commercial & residential and industrial businesses, and unfavorable foreign currency effects, partially offset by organic growth in the energy business and price increases[184](index=184&type=chunk)[185](index=185&type=chunk) - Thermal Management segment income as a percentage of net sales increased by **0.4 percentage points**, driven by higher selling prices and lean initiatives, partially offset by lower sales volume and inflationary labor costs[185](index=185&type=chunk)[186](index=186&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses nVent's liquidity, primarily from operating cash flows, capital requirements, debt structure, share repurchases, and dividends - Primary liquidity source is cash flows from operations, with expected cash requirements for working capital, capital expenditures, debt service, and dividends[187](index=187&type=chunk) - Seasonal cash flows are experienced, with increased demand for Electrical & Fastening Solutions in spring/summer and Thermal Management in fall/winter[188](index=188&type=chunk) Cash Flow Summary (in millions USD) | Activity | 2023 (millions USD) | 2022 (millions USD) | | :-------------------------------------- | :------- | :------- | | Net cash provided by operating activities | $528.1 | $394.6 | | Net cash used for investing activities | $(1,164.7) | $(52.5) | | Net cash provided by (used for) financing activities | $516.7 | $(82.1) | | Change in cash and cash equivalents | $(112.4) | $248.0 | - Investing activities in 2023 primarily included **$1,120.1 million** for ECM Industries and TEXA Industries acquisitions and **$71.0 million** in capital expenditures[191](index=191&type=chunk) - Financing activities in 2023 included **$800.0 million** from long-term debt proceeds (for ECM acquisition), offset by **$116.8 million** in dividends and **$60.8 million** in share repurchases[192](index=192&type=chunk) - In May 2023, nVent Finance issued **$500.0 million of 5.650% Senior Notes due 2033** to finance the ECM Industries acquisition[196](index=196&type=chunk) - The company was in compliance with all financial covenants in its debt agreements as of December 31, 2023[204](index=204&type=chunk) Material Contractual Cash Requirements (as of December 31, 2023, in millions USD) | Obligation | Within 1 year (millions USD) | Greater than 1 year (millions USD) | Total (millions USD) | | :-------------------------------------- | :------------ | :------------------ | :-------- | | Debt obligations | $31.9 | $1,760.6 | $1,792.5 | | Interest obligations on fixed-rate debt | $59.3 | $377.5 | $436.8 | | Operating lease obligations, net of sublease rentals | $31.1 | $114.9 | $146.0 | | **Total** | **$122.3** | **$2,253.0** | **$2,375.3** | Free Cash Flow (in millions USD) | Metric | 2023 (millions USD) | 2022 (millions USD) | | :-------------------------------------- | :------- | :------- | | Net cash provided by operating activities | $528.1 | $394.6 | | Capital expenditures | $(71.0) | $(45.9) | | Proceeds from sale of property and equipment | $7.5 | $2.0 | | **Free cash flow** | **$464.6** | **$350.7** | [Commitments and Contingencies](index=39&type=section&id=Commitments%20and%20Contingencies) The company is subject to various claims and disputes, with material impact deemed unlikely, and details outstanding bonds and guarantees - The company is subject to various claims and disputes, including commercial, product liability, environmental, and patent infringement matters[215](index=215&type=chunk) - While a material impact from future claims is considered unlikely, the inherent uncertainty of litigation means a remote possibility of material adverse rulings exists[216](index=216&type=chunk) - Outstanding bonds, letters of credit, and bank guarantees totaled **$45.5 million** as of December 31, 2023, up from **$38.0 million in 2022**[218](index=218&type=chunk) [Critical Accounting Estimates](index=39&type=section&id=Critical%20Accounting%20Estimates) This section outlines nVent's critical accounting estimates for business combinations, goodwill impairment, pension plans, and income taxes - Critical accounting estimates involve significant judgment and assumptions about uncertain future events, where changes could materially impact financial condition or results[219](index=219&type=chunk) - Business combinations require estimating fair values of acquired assets and liabilities, with goodwill recorded for excess purchase price. These estimates are subject to refinement for up to one year post-acquisition[220](index=220&type=chunk)[221](index=221&type=chunk) - Goodwill and indefinite-lived intangible assets are tested for impairment annually or more frequently if circumstances warrant, using discounted cash flow and market approaches. As of December 31, 2023, goodwill and intangible assets were **$4.1 billion**, representing **66% of total assets**[84](index=84&type=chunk)[222](index=222&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk) - Pension and other post-retirement plan valuations rely on actuarial assumptions (discount rates, expected return on assets, compensation increase rates). Mark-to-market adjustments for actuarial gains/losses can cause volatility[234](index=234&type=chunk)[235](index=235&type=chunk)[236](index=236&type=chunk) - Income tax accounting involves estimates for tax liabilities and recoverability of deferred tax assets, considering future taxable income and potential changes in tax laws and rates[240](index=240&type=chunk)[241](index=241&type=chunk)[242](index=242&type=chunk)[243](index=243&type=chunk) [ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk](index=43&type=section&id=ITEM%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) nVent manages market risks from interest rates and foreign currency through derivative financial instruments, with a debt portfolio primarily fixed-rate - nVent is exposed to market risks from changes in interest rates and foreign currency rates, managed through derivative financial instruments[245](index=245&type=chunk) - Foreign currency risk is mitigated using forward foreign currency contracts for assets/liabilities and cross currency swaps for intercompany debt and net investment hedges[246](index=246&type=chunk)[247](index=247&type=chunk)[248](index=248&type=chunk)[249](index=249&type=chunk) - As of December 31, 2023, outstanding foreign currency derivative contracts had gross notional U.S. dollar equivalent amounts of **$344.3 million**[248](index=248&type=chunk) - The debt portfolio as of December 31, 2023, was approximately **73% fixed-rate debt** and **27% variable-rate debt**[250](index=250&type=chunk) - A **100 basis point increase** in interest rates would increase interest incurred on variable-rate debt by **$4.9 million**[251](index=251&type=chunk) [ITEM 8. Financial Statements and Supplementary Data](index=44&type=section&id=ITEM%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents nVent's audited consolidated financial statements, management's internal control report, and the independent auditor's unqualified opinion - Management assessed the effectiveness of internal control over financial reporting as effective as of December 31, 2023, excluding ECM Industries (acquired May 2023)[254](index=254&type=chunk)[255](index=255&type=chunk) - Deloitte & Touche LLP issued an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting[259](index=259&type=chunk)[265](index=265&type=chunk)[266](index=266&type=chunk) - Critical audit matters included the evaluation of goodwill for impairment in the Thermal Management reporting unit (**$713.0 million** as of December 31, 2023) and the valuation of the ECM Industries acquired customer relationship intangible asset (**$381.7 million**)[270](index=270&type=chunk)[272](index=272&type=chunk) Consolidated Net Sales (in millions USD) | Year | Net Sales (millions USD) | | :--- | :-------- | | 2023 | $3,263.6 | | 2022 | $2,909.0 | | 2021 | $2,462.0 | Consolidated Net Income (in millions USD) | Year | Net Income (millions USD) | | :--- | :--------- | | 2023 | $567.1 | | 2022 | $399.8 | | 2021 | $272.9 | Consolidated Total Assets (in millions USD) | Year | Total Assets (millions USD) | | :--- | :----------- | | 2023 | $6,161.7 | | 2022 | $4,902.2 | Consolidated Total Liabilities (in millions USD) | Year | Total Liabilities (millions USD) | | :--- | :---------------- | | 2023 | $3,019.6 | | 2022 | $2,170.5 | Consolidated Net Cash Provided by Operating Activities (in millions USD) | Year | Net Cash Provided by Operating Activities (millions USD) | | :--- | :---------------------------------------- | | 2023 | $528.1 | | 2022 | $394.6 | | 2021 | $373.3 | [Management's Report on Internal Control Over Financial Reporting](index=44&type=section&id=Management%27s%20Report%20on%20Internal%20Control%20Over%20Financial%20Reporting) Management assessed internal control over financial reporting as effective as of December 31, 2023, excluding the recently acquired ECM Industries - Management is responsible for establishing and maintaining adequate internal control over financial reporting[252](index=252&type=chunk) - As of December 31, 2023, management assessed the company's internal control over financial reporting as effective, based on the COSO framework[254](index=254&type=chunk) - The assessment excluded ECM Industries, acquired in May 2023, which accounted for approximately **4% of total assets** and **7% of total net sales**[255](index=255&type=chunk) [Report of Independent Registered Public Accounting Firm](index=45&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Deloitte & Touche LLP issued an unqualified opinion on the effectiveness of nVent's internal control over financial reporting, excluding ECM Industries - Deloitte & Touche LLP issued an unqualified opinion on the effectiveness of nVent's internal control over financial reporting as of December 31, 2023[258](index=258&type=chunk) - The audit of internal control over financial reporting excluded ECM Industries, consistent with management's assessment[260](index=260&type=chunk) [Report of Independent Registered Public Accounting Firm (Financial Statements)](index=46&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm%20%28Financial%20Statements%29) Deloitte & Touche LLP issued an unqualified opinion on the consolidated financial statements, affirming fair presentation in conformity with GAAP - Deloitte & Touche LLP issued an unqualified opinion on the consolidated financial statements for the period ended December 31, 2023, stating they present fairly the financial position and results of operations in conformity with GAAP[265](index=265&type=chunk) [Critical Audit Matters](index=46&type=section&id=Critical%20Audit%20Matters) Critical audit matters included goodwill impairment for Thermal Management and the valuation of ECM Industries' customer relationship intangible asset - The evaluation of goodwill for impairment in the Thermal Management reporting unit (**$713.0 million** as of December 31, 2023) was a critical audit matter due to significant management estimates and assumptions in fair value determination[270](index=270&type=chunk)[271](index=271&type=chunk) - The valuation of the ECM Industries acquired customer relationship intangible asset (**$381.7 million**) was also a critical audit matter, requiring significant judgment on future cash flows, margin, revenue growth, discount, and customer attrition rates[272](index=272&type=chunk)[273](index=273&type=chunk) [Consolidated Statements of Operations and Comprehensive Income](index=49&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) This section presents consolidated statements of operations and comprehensive income, detailing net sales, gross profit, operating income, and net income Consolidated Statements of Operations and Comprehensive Income (in millions USD, except per share data) | Metric | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------------------- | :------- | :------- | :------- | | Net sales | $3,263.6 | $2,909.0 | $2,462.0 | | Gross profit | $1,342.1 | $1,096.7 | $941.9 | | Operating income | $587.4 | $440.4 | $355.4 | | Net income | $567.1 | $399.8 | $272.9 | | Basic EPS | $3.42 | $2.40 | $1.63 | | Diluted EPS | $3.37 | $2.38 | $1.61 | | Comprehensive income | $562.7 | $383.4 | $284.9 | [Consolidated Balance Sheets](index=50&type=section&id=Consolidated%20Balance%20Sheets) This section presents consolidated balance sheets, detailing assets, liabilities, and equity, including cash, goodwill, and long-term debt Consolidated Balance Sheets (in millions USD) | Asset/Liability/Equity | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :-------------------------------------- | :------------------ | :------------------ | | Cash and cash equivalents | $185.1 | $297.5 | | Total current assets | $1,336.1 | $1,229.2 | | Property, plant and equipment, net | $390.0 | $289.2 | | Goodwill | $2,571.1 | $2,178.1 | | Intangibles, net | $1,517.0 | $1,066.1 | | Total assets | $6,161.7 | $4,902.2 | | Total current liabilities | $733.6 | $649.5 | | Long-term debt | $1,748.8 | $1,068.2 | | Total liabilities | $3,019.6 | $2,170.5 | | Total equity | $3,142.1 | $2,731.7 | [Consolidated Statements of Cash Flows](index=51&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section presents consolidated statements of cash flows, detailing cash flows from operating, investing, and financing activities Consolidated Statements of Cash Flows (in millions USD) | Activity | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :---------------------------------------- | :------- | :------- | :------- | | Net cash provided by operating activities | $528.1 | $394.6 | $373.3 | | Net cash used for investing activities | $(1,164.7) | $(52.5) | $(274.0) | | Net cash provided by (used for) financing activities | $516.7 | $(82.1) | $(166.8) | | Cash and cash equivalents, end of year | $185.1 | $297.5 | $49.5 | | Cash paid for interest, net | $103.2 | $49.2 | $43.0 | | Cash paid for income taxes, net | $112.4 | $87.3 | $61.3 | [Consolidated Statements of Changes in Equity](index=52&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity) This section presents consolidated statements of changes in equity, detailing total equity, net income, dividends, and share repurchases Consolidated Statements of Changes in Equity (in millions USD) | Metric | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | December 31, 2021 (millions USD) | | :-------------------------------------- | :------------------ | :------------------ | :------------------ | | Total Equity | $3,142.1 | $2,731.7 | $2,496.1 | | Net income | $567.1 | $399.8 | $272.9 | | Dividends declared | $(119.1) | $(117.0) | $(119.1) | | Share repurchases | $(58.8) | $(63.3) | $(116.1) | | Share-based compensation | $23.5 | $25.0 | $16.6 | [Notes to Consolidated Financial Statements](index=53&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [1. Basis of Presentation and Summary of Significant Accounting Policies](index=53&type=section&id=1.%20Basis%20of%20Presentation%20and%20Summary%20of%20Significant%20Accounting%20Policies) nVent is an Irish-incorporated company providing electrical solutions, with financial statements prepared under GAAP, requiring estimates for goodwill, revenue, and pensions - nVent is an Irish-incorporated company with tax residency in the U.K., providing electrical connection and protection solutions across three segments[287](index=287&type=chunk)[288](index=288&type=chunk) - Financial statements are prepared in USD under GAAP, requiring significant management estimates for items like goodwill valuation, inventory, acquisitions, and income taxes[289](index=289&type=chunk)[291](index=291&type=chunk) - Revenue is recognized when control of goods/services transfers to customers. **76% of 2023 revenue** was recognized at a point in time (upon shipment), and **24% over time** (cost-to-cost or output method)[292](index=292&type=chunk)[295](index=295&type=chunk)[296](index=296&type=chunk) - Goodwill and indefinite-lived intangibles are tested annually for impairment using discounted cash flow and market approaches. No impairment was recorded in 2023, 2022, or 2021[316](index=316&type=chunk)[319](index=319&type=chunk)[322](index=322&type=chunk) - Pension and other post-retirement benefits are determined by actuarial valuations, with mark-to-market adjustments for actuarial gains/losses recognized annually in Q4[324](index=324&type=chunk)[325](index=325&type=chunk) - Derivative financial instruments are recognized at fair value and used to hedge interest rate and currency exposures, not for trading[327](index=327&type=chunk)[329](index=329&type=chunk) [2. Revenue](index=59&type=section&id=2.%20Revenue) This section provides a breakdown of nVent's net sales by geographic region and vertical market, along with contract balances Geographic Net Sales (in millions USD) | Region | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :------------- | :------- | :------- | :------- | | North America | $2,383.3 | $2,042.3 | $1,590.4 | | EMEA | $677.8 | $660.6 | $670.7 | | Asia-Pacific | $190.9 | $193.5 | $190.5 | | Rest of World | $11.6 | $12.6 | $10.4 | | **Total** | **$3,263.6** | **$2,909.0** | **$2,462.0** | Vertical Net Sales (in millions USD) | Vertical | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------- | :------- | :------- | :------- | | Industrial | $1,282.8 | $1,212.3 | $1,051.7 | | Commercial & Residential | $995.0 | $823.9 | $728.3 | | Infrastructure | $824.6 | $726.0 | $554.3 | | Energy | $161.2 | $146.8 | $127.7 | | **Total** | **$3,263.6** | **$2,909.0** | **$2,462.0** | Contract Balances (in millions USD) | Metric | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | $ Change (millions USD) | % Change | | :---------------- | :------------------ | :------------------ | :---------------------- | :---------------------- | | Contract assets | $44.1 | $45.6 | $(1.5) | (3.3)% | | Contract liabilities | $27.1 | $22.7 | $4.4 | 19.4% | | **Net contract assets** | **$17.0** | **$22.9** | **$(5.9)** | **(25.8)%** | - The decrease in net contract assets in 2023 was primarily due to the timing of milestone payments[335](index=335&type=chunk) - Remaining performance obligations for contracts with an original expected length of one year or more totaled **$17.2 million** as of December 31, 2023, with most expected to be recognized within 12-18 months[336](index=336&type=chunk) [3. Restructuring](index=61&type=section&id=3.%20Restructuring) This section details nVent's restructuring initiatives, including costs for severance, aimed at reducing fixed costs and realigning the business - Restructuring initiatives in 2023, 2022, and 2021 aimed at reducing fixed cost structure and realigning the business, including headcount reductions[337](index=337&type=chunk) Total Restructuring Costs (in millions USD) | Cost Type | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :------------------------ | :------- | :------- | :------- | | Severance and related costs | $7.8 | $5.2 | $4.9 | | Other | $5.0 | $1.2 | $3.9 | | **Total restructuring costs** | **$12.8** | **$6.4** | **$8.8** | Restructuring Costs by Segment (in millions USD) | Segment | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------- | :------- | :------- | :------- | | Enclosures | $1.4 | $3.5 | $6.0 | | Electrical & Fastening Solutions | $1.6 | — | $0.7 | | Thermal Management | $8.9 | $0.6 | $1.4 | | Other | $0.9 | $2.3 | $0.7 | | **Consolidated** | **$12.8** | **$6.4** | **$8.8** | [4. Earnings Per Share](index=61&type=section&id=4.%20Earnings%20Per%20Share) This section presents the calculation of basic and diluted earnings per ordinary share based on net income and weighted average shares Earnings Per Ordinary Share (in millions, except per share data) | Metric | 2023 | 2022 | 2021 | | :------------------------------------------------------ | :------- | :------- | :------- | | Net income (millions USD) | $567.1 | $399.8 | $272.9 | | Basic weighted average ordinary shares outstanding (millions) | 165.6 | 166.3 | 167.9 | | Diluted weighted average ordinary shares outstanding (millions) | 168.2 | 168.3 | 169.7 | | **Basic earnings per ordinary share** | **$3.42** | **$2.40** | **$1.63** | | **Diluted earnings per ordinary share** | **$3.37** | **$2.38** | **$1.61** | | Anti-dilutive stock options excluded (millions) | 0.3 | 0.6 | 0.6 | [5. Acquisitions](index=62&type=section&id=5.%20Acquisitions) This section details nVent's acquisitions, including the $1.1 billion ECM Industries acquisition, its purchase price allocation, and pro forma financials - On May 18, 2023, nVent acquired ECM Industries for approximately **$1.1 billion in cash**, funded primarily by new debt[341](index=341&type=chunk) Preliminary Purchase Price Allocation for ECM Industries Acquisition (in millions USD) | Asset/Liability | As Previously Reported (Sept 30, 2023) (millions USD) | As Revised (Dec 31, 2023) (millions USD) | | :-------------------------- | :------------------------------------- | :------------------------ | | Cash | $45.7 | $45.7 | | Accounts receivable | $78.1 | $77.0 | | Inventories | $104.0 | $104.2 | | Property, plant and equipment | $75.9 | $75.3 | | Identifiable intangible assets | $524.0 | $524.0 | | Goodwill | $371.7 | $375.7 | | Current liabilities | $(51.4) | $(53.9) | | **Purchase price** | **$1,133.7** | **$1,134.1** | - Identifiable intangible assets acquired from ECM Industries included **$113.7 million in trade names** (mostly indefinite-lived), **$381.7 million in definite-lived customer relationships** (20-year useful life), and **$22.0 million in definite-lived proprietary technology** (7-year useful life)[344](index=344&type=chunk) - ECM Industries contributed **$240.7 million in net sales** and **$31.4 million in operating income** from acquisition date to December 31, 2023[345](index=345&type=chunk) Unaudited Pro Forma Financial Information (ECM Industries Acquisition, in millions USD, except per share data) | Metric | 2023 (millions USD) | 2022 (millions USD) | | :-------------------------- | :------- | :------- | | Pro forma net sales | $3,420.1 | $3,316.5 | | Pro forma net income | $597.5 | $364.5 | | Pro forma basic EPS | $3.61 | $2.19 | | Pro forma diluted EPS | $3.55 | $2.17 | - Other acquisitions in 2021 included Vynckier (**$27.0 million**) and CIS Global LLC (**$202.4 million**), and in 2023, TEXA Industries (**$34.8 million**)[350](index=350&type=chunk)[352](index=352&type=chunk)[354](index=354&type=chunk) [6. Goodwill and Other Identifiable Intangible Assets](index=64&type=section&id=6.%20Goodwill%20and%20Other%20Identifiable%20Intangible%20Assets) This section details changes in goodwill by reporting unit, identifiable intangible assets, and estimated future amortization expense Changes in Goodwill by Reporting Unit (in millions USD) | Segment | December 31, 2022 (millions USD) | Acquisitions/Divestitures (millions USD) | Foreign Currency Translation/Other (millions USD) | December 31, 2023 (millions USD) | | :-------------------------- | :------------------ | :------------------------ | :------------------------------- | :------------------ | | Enclosures | $414.4 | $11.3 | $4.7 | $430.4 | | Electrical & Fastening Solutions | $1,052.0 | $375.7 | — | $1,427.7 | | Thermal Management | $711.7 | — | $1.3 | $713.0 | | **Total goodwill** | **$2,178.1** | **$387.0** | **$6.0** | **$2,571.1** | - No goodwill impairment expense was recorded in 2023, 2022, or 2021[357](index=357&type=chunk) Identifiable Intangible Assets (in millions USD, as of December 31, 2023) | Type | Cost (millions USD) | Accumulated Amortization (millions USD) | Net (millions USD) | | :-------------------------------- | :------- | :----------------------- | :------- | | Customer relationships | $1,684.8 | $(599.3) | $1,085.5 | | Proprietary technologies and patents | $63.7 | $(20.8) | $42.9 | | Other definite-life intangible assets | $18.0 | $(4.8) | $13.2 | | **Total definite-life intangibles** | **$1,766.5** | **$(624.9)** | **$1,141.6** | | Trade names (indefinite-life) | $375.4 | — | $375.4 | | **Total intangibles** | **$2,141.9** | **$(624.9)** | **$1,517.0** | - Identifiable intangible asset amortization expense was **$89.7 million in 2023**, **$70.7 million in 2022**, and **$67.5 million in 2021**[358](index=358&type=chunk) Estimated Future Amortization Expense for Identifiable Intangible Assets (in millions USD) | Year | Estimated Amortization Expense (millions USD) | | :--- | :----------------------------- | | 2024 | $97.0 | | 2025 | $94.5 | | 2026 | $94.5 | | 2027 | $94.4 | | 2028 | $90.2 | [7. Supplemental Balance Sheet Information](index=65&type=section&id=7.%20Supplemental%20Balance%20Sheet%20Information) This section provides supplemental balance sheet information, including detailed breakdowns of inventories, property, plant and equipment, and other assets/liabilities Inventories (in millions USD) | Category | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :---------------------- | :------------------ | :------------------ | | Raw materials and supplies | $165.1 | $112.9 | | Work-in-process | $34.9 | $36.2 | | Finished goods | $241.3 | $197.6 | | **Total inventories** | **$441.3** | **$346.7** | Property, Plant and Equipment, Net (in millions USD) | Category | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :-------------------------------- | :------------------ | :------------------ | | Land and land improvements | $39.6 | $38.6 | | Buildings and leasehold improvements | $217.4 | $180.5 | | Machinery and equipment | $599.6 | $500.4 | | Construction in progress | $37.2 | $34.7 | | Total property, plant and equipment | $893.8 | $754.2 | | Accumulated depreciation and amortization | $503.8 | $465.0 | | **Total property, plant and equipment, net** | **$390.0** | **$289.2** | Other Non-Current Assets (in millions USD) | Category | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :-------------------------- | :------------------ | :------------------ | | Deferred compensation plan assets | $19.4 | $16.7 | | Lease right-of-use assets | $118.7 | $76.4 | | Deferred tax assets | $179.2 | $16.3 | | Other non-current assets | $30.2 | $30.2 | | **Total other non-current assets** | **$347.5** | **$139.6** | Other Current Liabilities (in millions USD) | Category | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :-------------------------- | :------------------ | :------------------ | | Dividends payable | $32.6 | $30.4 | | Accrued rebates | $90.7 | $98.4 | | Contract liabilities | $27.1 | $22.7 | | Accrued taxes payable | $54.0 | $34.5 | | Current lease liabilities | $25.6 | $17.7 | | Accrued interest | $11.2 | $6.5 | | Other current liabilities | $62.6 | $62.9 | | **Total other current liabilities** | **$303.8** | **$273.1** | [8. Accumulated Other Comprehensive Loss](index=66&type=section&id=8.%20Accumulated%20Other%20Comprehensive%20Loss) This section details components of accumulated other comprehensive loss, including cumulative translation adjustments and derivative market value changes Components of Accumulated Other Comprehensive Loss (in millions USD) | Component | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :------------------------------------------------ | :------------------ | :------------------ | | Cumulative translation adjustments | $(108.0) | $(118.5) | | Change in market value of derivative financial instruments, net of tax | $4.0 | $18.9 | | **Accumulated other comprehensive loss** | **$(104.0)** | **$(99.6)** | [9. Debt](index=66&type=section&id=9.%20Debt) This section details nVent's debt outstanding, including term loans and senior notes, interest rates, maturities, and compliance with financial covenants Debt Outstanding (in millions USD) | Debt Type | Average Interest Rate (Dec 31, 2023) | Maturity Year | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :-------------------------- | :----------------------------------- | :------------ | :------------------ | :------------------ | | 2021 Term loan facility | 6.708% | 2026 | $200.0 | $288.8 | | 2023 Term loan facility | 6.708% | 2028 | $292.5 | — | | Senior notes - fixed rate (2028) | 4.550% | 2028 | $500.0 | $500.0 | | Senior notes - fixed rate (2031) | 2.750% | 2031 | $300.0 | $300.0 | | Senior notes - fixed rate (2033) | 5.650% | 2033 | $500.0 | — | | Unamortized issuance costs and discounts | N/A | N/A | $(11.8) | $(5.6) | | **Total debt** | | | **$1,780.7** | **$1,083.2** | | Less: Current maturities and short-term borrowings | | | $(31.9) | $(15.0) | | **Long-term debt** | | | **$1,748.8** | **$1,068.2** | - In May 2023, nVent Finance issued **$500.0 million of 5.650% Senior Notes due 2033** to finance the ECM Industries acquisition[365](index=365&type=chunk) - The Notes are fully and unconditionally guaranteed by nVent Electric plc and constitute general unsecured senior obligations[366](index=366&type=chunk)[367](index=367&type=chunk) - In April 2023, nVent and nVent Finance entered into a **$300.0 million unsecured term loan facility** (2023 Term Loan Facility) for the ECM Industries acquisition[371](index=371&type=chunk) - As of December 31, 2023, the company was in compliance with all financial covenants in its debt agreements[372](index=372&type=chunk) Contractual Debt Obligation Maturities (in millions USD) | Year | Amount (millions USD) | | :--------- | :------- | | 2024 | $31.9 | | 2025 | $37.5 | | 2026 | $179.4 | | 2027 | $22.5 | | 2028 | $721.2 | | Thereafter | $800.0 | | **Total** | **$1,792.5** | [10. Derivatives and Financial Instruments](index=68&type=section&id=10.%20Derivatives%20and%20Financial%20Instruments) nVent uses derivative financial instruments to manage foreign currency and interest rate exposures, detailing their fair values and notional amounts - nVent uses derivative financial instruments (forward foreign currency contracts, cross currency swaps, interest rate swaps) to manage foreign currency and interest rate exposures, not for speculative purposes[374](index=374&type=chunk)[375](index=375&type=chunk)[380](index=380&type=chunk) - Outstanding foreign currency derivative contracts had gross notional U.S. dollar equivalent amounts of **$146.8 million** at December 31, 2023[376](index=376&type=chunk) - Cross currency swaps are used as cash flow hedges, fair value hedges for intercompany debt, or net investment hedges for Euro-U.S. Dollar exchange rate fluctuations[377](index=377&type=chunk) Fair Value of Financial Instruments (in millions USD, as of December 31, 2023) | Instrument | Recorded Amount (millions USD) | Fair Value (millions USD) | | :-------------------- | :-------------- | :--------- | | Variable rate debt | $492.5 | $492.5 | | Fixed rate debt | $1,300.0 | $1,261.6 | | **Total debt** | **$1,792.5** | **$1,754.1** | Recurring Fair Value Measurements (in millions USD, as of December 31, 2023) | Instrument | Level 1 (millions USD) | Level 2 (millions USD) | Level 3 (millions USD) | NAV (millions USD) | Total (millions USD) | | :-------------------------- | :------ | :------ | :------ | :---- | :------ | | Cross currency swap liabilities | — | $(21.7) | — | — | $(21.7) | | Cross currency swap assets | — | $3.9 | — | — | $3.9 | | Foreign currency contract liabilities | — | $(0.8) | — | — | $(0.8) | | Foreign currency contract assets | — | $2.1 | — | — | $2.1 | | Deferred compensation plan assets | $13.3 | — | — | $6.1 | $19.4 | | **Total** | **$13.3** | **$(16.5)** | **—** | **$6.1** | **$2.9** | [11. Income Taxes](index=70&type=section&id=11.%20Income%20Taxes) This section details nVent's income before taxes, provision for taxes, and effective tax rate reconciliation, including significant non-cash tax benefits Income Before Income Taxes (in millions USD) | Category | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :------------- | :------- | :------- | :------- | | Federal (U.K. loss) | $(15.1) | $(23.4) | $(23.7) | | International (non-U.K. income) | $514.6 | $496.0 | $344.4 | | **Total** | **$499.5** | **$472.6** | **$320.7** | Provision (Benefit) for Income Taxes (in millions USD) | Category | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :------------- | :------- | :------- | :------- | | Total current taxes | $110.1 | $86.9 | $66.2 | | Total deferred taxes | $(177.7) | $(14.1) | $(18.4) | | **Total provision (benefit)** | **$(67.6)** | **$72.8** | **$47.8** | Effective Tax Rate Reconciliation (Percentages) | Item | 2023 | 2022 | 2021 | | :-------------------------------------- | :------- | :------- | :------- | | Federal statutory income tax rate | 23.5% | 19.0% | 19.0% | | Tax effect of international operations | (4.1)% | — | (6.7)% | | Change in tax basis of foreign assets | (14.4)% | — | — | | Recognition of foreign income tax loss carryforwards | (18.7)% | — | — | | **Effective tax rate** | **(13.5)%** | **15.4%** | **14.9%** | - In 2023, a non-cash income tax benefit of **$72.0 million** was recorded for a step-up in tax basis of intangible assets in Switzerland, and **$93.2 million** for foreign income tax loss carryforwards in Luxembourg[382](index=382&type=chunk) Gross Unrecognized Tax Benefits (in millions USD) | Metric | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------------------- | :------- | :------- | :------- | | Beginning balance | $13.4 | $15.6 | $17.1 | | Ending balance | $13.9 | $13.4 | $15.6 | - It is reasonably possible that gross unrecognized tax benefits may decrease by **$0 to $3.7 million** during 2024 due to resolution of non-U.K. examinations and statute expirations[383](index=383&type=chunk) - As of December 31, 2023, **$830.0 million in tax loss carryforwards** were available, with a **$98.4 million valuation allowance**[390](index=390&type=chunk) [12. Benefit Plans](index=72&type=section&id=12.%20Benefit%20Plans) This section details nVent's defined-benefit pension and post-retirement health plans, including funded status, benefit expense, assumptions, and asset allocation - nVent sponsors U.S. and non-U.S. defined-benefit pension plans and a post-retirement health plan[391](index=391&type=chunk) Pension Plans Funded Status (in millions USD) | Metric | December 31, 2023 (millions USD) | December 31, 2022 (millions USD) | | :---------------------------------------- | :------------------ | :------------------ | | Benefit obligation end of year | $159.1 | $133.6 | | Fair value of plan assets end of year | $33.0 | $27.7 | | **Benefit obligations in excess of plan assets** | **$(126.1)** | **$(105.9)** | Net Periodic Benefit Expense (Income) for Pension Plans (in millions USD) | Metric | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------- | :------- | :------- | :------- | | Service cost | $2.2 | $2.6 | $3.2 | | Interest cost | $5.8 | $3.1 | $2.8 | | Expected return on plan assets | $(1.4) | $(1.2) | $(1.1) | | Net actuarial loss (gain) | $14.5 | $(62.7) | $(13.7) | | **Net periodic benefit expense (income)** | **$21.1** | **$(58.2)** | **$(8.8)** | Weighted-Average Assumptions for Pension Plans (Percentages) | Assumption | 2023 | 2022 | 2021 | | :-------------------------------- | :------- | :------- | :------- | | Discount rate (benefit obligations) | 3.51% | 4.24% | 1.55% | | Discount rate (net periodic benefit expense) | 4.24% | 1.55% | 1.26% | | Expected long-term return on plan assets | 4.76% | 3.81% | 3.64% | | Rate of compensation increase | 3.40% | 3.42% | 2.96% | Pension Plan Asset Allocation (Percentages) | Asset Class | 2023 | 2022 | | :------------------ | :------- | :------- | | Equity securities | 45% | 52% | | Fixed income | 34% | 28% | | Alternative investments | 18% | 16% | | Cash equivalents | 3% | 4% | - Pension and other post-retirement plan contributions were **$6.5 million in 2023** and **$5.5 million in 2022**. Expected 2024 contributions are **$7.3 million**[402](index=402&type=chunk) Estimated Future Benefit Payments (in millions USD) | Year | Pension Plans (millions USD) | Post-retirement Health Plan (millions USD) | | :--------- | :------------ | :-------------------------- | | 2024 | $5.7 | $1.2 | | 2025 | $6.8 | $1.1 | | 2026 | $6.3 | $1.1 | | 2027 | $8.0 | $1.1 | | 2028 | $9.0 | $1.0 | | 2029-2033 | $45.8 | $4.6 | - 401(k) plan expense was **$13.9 million in 2023**, **$12.5 million in 2022**, and **$8.6 million in 2021**[404](index=404&type=chunk) [13. Shareholders' Equity](index=76&type=section&id=13.%20Shareholders%27%20Equity) This section details nVent's authorized share capital, share repurchase activities, dividends paid per ordinary share, and distributable reserves - Authorized share capital consists of **400.0 million ordinary shares** with a par value of **$0.01 per share**[405](index=405&type=chunk) - Under the 2021 Authorization, nVent repurchased **1.2 million ordinary shares for $58.8 million in 2023** and **1.6 million shares for $63.3 million in 2022**[407](index=407&type=chunk) - As of December 31, 2023, **$81.8 million** remained available for share repurchases under the 2021 Authorization[408](index=408&type=chunk) - Dividends paid per ordinary share were **$0.70** for both 2023 and 2022[409](index=409&type=chunk) - A quarterly cash dividend of **$0.19 per ordinary share** was declared on December 12, 2023, and again on February 20, 2024[410](index=410&type=chunk)[411](index=411&type=chunk) - Distributable reserves were **$2.7 billion** as of December 31, 2023[209](index=209&type=chunk) [14. Segment Information](index=76&type=section&id=14.%20Segment%20Information) This section provides detailed financial information for nVent's three segments: Enclosures, Electrical & Fastening Solutions, and Thermal Management - nVent classifies operations into Enclosures, Electrical & Fastening Solutions, and Thermal Management segments[412](index=412&type=chunk) - Segment income excludes intangible amortization, acquisition-related costs, restructuring activities, pension mark-to-market adjustments, impairments, and other unusual non-operating items[413](index=413&type=chunk) Net Sales by Segment (in millions USD) | Segment | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------- | :------- | :------- | :------- | | Enclosures | $1,605.9 | $1,503.7 | $1,244.8 | | Electrical & Fastening Solutions | $1,063.0 | $791.4 | $657.5 | | Thermal Management | $594.7 | $613.9 | $559.7 | | Other | — | — | — | | **Consolidated** | **$3,263.6** | **$2,909.0** | **$2,462.0** | Segment Income (Loss) (in millions USD) | Segment | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------- | :------- | :------- | :------- | | Enclosures | $346.6 | $256.0 | $202.1 | | Electrical & Fastening Solutions | $330.6 | $219.9 | $181.5 | | Thermal Management | $138.5 | $140.8 | $121.2 | | Other | $(95.1) | $(93.1) | $(69.0) | | **Consolidated** | **$720.6** | **$523.6** | **$435.8** | Reconciliation of Segment Income to Income Before Income Taxes (in millions USD) | Item | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------------------- | :------- | :------- | :------- | | Segment income | $720.6 | $523.6 | $435.8 | | Intangible amortization | $(89.7) | $(70.7) | $(67.5) | | Pension and other post-retirement mark-to-market (loss) gain | $(13.9) | $66.3 | $15.1 | | Acquisition transaction and integration costs | $(13.0) | $(0.8) | $(4.1) | | Inventory step-up amortization | $(17.7) | — | — | | Interest expense, net | $(79.4) | $(31.2) | $(32.3) | | **Income before income taxes** | **$499.5** | **$472.6** | **$320.7** | [15. Share-Based Compensation](index=78&type=section&id=15.%20Share-Based%20Compensation) This section details nVent's long-term incentive program, including RSUs, PSUs, and stock options, along with total compensation expense - nVent's long-term incentive program includes restricted stock units (RSUs), performance share units (PSUs), and stock options under the 2018 Omnibus Incentive Plan[417](index=417&type=chunk) Total Share-Based Compensation Expense (in millions USD) | Award Type | 2023 (millions USD) | 2022 (millions USD) | 2021 (millions USD) | | :-------------------------- | :------- | :------- | :------- | | Restricted stock units | $11.3 | $9.8 | $8.7 | | Performance share units | $7.7 | $11.1 | $4.1 | | Stock options | $4.5 | $4.1 | $3.8 | | **Total** | **$23.5** | **$25.0** | **$16.6** | - As of December 31, 2023, unrecognized compensation expense for RSUs was **$8.6 million** (**1.9 years** weighted-average period), for PSUs was **$8.7 million** (**1.7 years**), and for stock options was **$3.3 million** (**1.9 years**)[420](index=420&type=chunk)[423](index=423&type=chunk)[427](index=427&type=chunk) - PSUs granted in 2023, 2022, and 2021 vest based on a three-year service period and total shareholder return (TSR) relative to the S&P 400 Industrials[422](index=422&type=chunk) - Stock options generally vest one-third each year over three years and expire ten years after the grant date, with fair value estimated using a Black-Scholes model[424](index=424&type=chunk)[425](index=425&type=chunk) [16. Leases](index=80&type=section&id=16.%20Leases) This section details nVent's operating leases, including rent expense, weighted average lease term and discount rate, and future lease payments - nVent has operating leases for office space, production facilities, distribution centers, warehouses, sales offices, fleet vehicles, and equipment[429](index=429&type=chunk) - Rent expense was **$29.7 million in 2023**, **$25.9 million in 2022**, and **$19.9 million in 2021**[431](index=431&type=chunk) Weighted Average Lease Term and Discount Rate (as of December 31) | Metric | 2023 | 2022 | | :-------------------------- | :------- | :------- | | Weighted average remaining lease term (Operating leases) | 6 years | 6 years | | Weighted average discount rate (Operating leases) | 4.9% | 4.0% | Future Lease Payments Under Non-Cancelable Operating Leases (in millions USD, as of December 31, 2023) | Year | Amount (millions USD) | | :--------- | :------- | | 2024 | $31.1 | | 2025 | $28.1 | | 2026 | $25.4 | | 2027 | $21.4 | | 2028 | $14.6 | | Thereafter | $25.4 | | **Total lease payments** | **$146.0** | | Less imputed interest | $(22.0) | | **Total reported lease liability** | **$124.0** | Supplemental Balance Sheet Information Related to Operating Leases (in millions USD, as of December 31) | Item | Classification | 2023 (millions USD) | 2022 (millions USD) | | :-------------------------- | :-------------------- | :------- | :------- | | Lease right-of-use assets | Other non-current assets | $118.7 | $76.4 | | Current lease liabilities | Other current liabilities | $25.6 | $17.7 | | Non-current lease liabilities | Other non-current liabilities | $98.4 | $63.7 | | **Total lease liabilities** | | **$124.0** | **$81.4** | [17. Commitments and Contingencies](index=81&type=section&id=17.%20Commitments%20and%20Contingencies) nVent provides product warranties and indemnifications, with historically insignificant payments, and details outstanding bonds and guarantees - nVent provides warranties and guarantees on its products and may indemnify purchasers for various liabilities related to sold businesses[435](index=435&type=chunk)[437](index=437&type=chunk) - The maximum obligation under indemnifications is generally not explicitly stated or reasonably estimable, but historically, payments have not been significant[436](index=436&type=chunk) - Outstanding bonds, letters of credit, and bank guarantees totaled **$45.5 million** as of December 31, 2023, up from **$38.0 million in 2022**[439](index=439&type=chunk) - Management does not believe existing disputes, administrative proceedings, and other claims will have a material impact on consolidated financial statements, but litigation outcomes are unpredictable[440](index=440&type=chunk) [ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=78&type=section&id=ITEM%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reported no changes in or disagreements with accountants on accounting and financial disclosure - There were no changes in or disagreements with accountants on accounting and financial disclosure[441](index=441&type=chunk) [ITEM 9A. Controls and Procedures](index=83&type=section&id=ITEM%209A.%20Controls%20and%20Procedures) Management evaluated disclosure controls and procedures as effective, with ongoing integration of ECM Industries into internal controls - Disclosure controls and procedures were evaluated as e

[PART I FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents the unaudited financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures for the period [Financial Statements (unaudited)](index=3&type=section&id=ITEM%201.%20Financial%20Statements%20(unaudited)) The unaudited financial statements for Q3 2023 reflect significant growth in sales and net income, driven by acquisitions, alongside increased assets and debt [Condensed Consolidated Statements of Income and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) This statement details the company's revenues, expenses, and net income for the quarter and nine months ended September 30, 2023 Consolidated Income Statement Highlights (in millions, except per-share data) | Metric | Q3 2023 | Q3 2022 | YoY Change | Nine Months 2023 | Nine Months 2022 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $858.8 | $745.2 | +15.2% | $2,402.4 | $2,167.4 | +10.8% | | **Gross Profit** | $353.2 | $290.0 | +21.8% | $988.3 | $805.1 | +22.8% | | **Operating Income** | $156.2 | $120.5 | +29.6% | $427.0 | $315.3 | +35.4% | | **Net Income** | $105.5 | $93.4 | +13.0% | $312.2 | $241.1 | +29.5% | | **Diluted EPS** | $0.63 | $0.55 | +14.5% | $1.86 | $1.43 | +30.1% | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This statement provides a snapshot of the company's assets, liabilities, and equity as of September 30, 2023, highlighting acquisition impacts Consolidated Balance Sheet Highlights (in millions) | Metric | Sep 30, 2023 | Dec 31, 2022 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $113.3 | $297.5 | -62.0% | | Goodwill | $2,559.8 | $2,178.1 | +17.5% | | Intangibles, net | $1,538.4 | $1,066.1 | +44.3% | | **Total Assets** | **$5,925.7** | **$4,902.2** | **+20.9%** | | Long-term debt | $1,831.5 | $1,068.2 | +71.4% | | **Total Liabilities** | **$2,980.6** | **$2,170.5** | **+37.3%** | | **Total Equity** | **$2,945.1** | **$2,731.7** | **+7.8%** | - The significant increases in Goodwill, Intangibles, and Long-term debt are primarily attributable to the acquisition of ECM Industries during 2023[13](index=13&type=chunk)[37](index=37&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement summarizes cash inflows and outflows from operating, investing, and financing activities for the nine months ended September 30, 2023 Consolidated Cash Flow Highlights (Nine months ended Sep 30, in millions) | Metric | 2023 | 2022 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $291.6 | $199.8 | +$91.8 | | Net cash used for investing activities | $(1,144.1) | $(37.4) | -$(1,106.7) | | Net cash provided by financing activities | $672.1 | $1.2 | +$670.9 | - Investing activities in 2023 were dominated by **$1.12 billion** used for acquisitions, net of cash acquired, which was funded by **$800.0 million** in proceeds from long-term debt[16](index=16&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed information on revenue, significant acquisitions of ECM Industries and TEXA Industries, and the associated financing and debt increases - On May 18, 2023, the company acquired ECM Industries for approximately **$1.1 billion** in cash, a leading provider of electrical connectors and tools, now part of the Electrical & Fastening Solutions segment[37](index=37&type=chunk) - On July 10, 2023, the company acquired TEXA Industries, an Italian manufacturer of industrial cooling applications, for approximately **$34.8 million** in cash, which is part of the Enclosures segment[45](index=45&type=chunk) - To finance the ECM acquisition, the company issued **$500.0 million** of 5.650% Senior Notes due 2033 and entered into a new **$300.0 million** unsecured term loan facility[62](index=62&type=chunk)[68](index=68&type=chunk) Net Sales by Segment (in millions) | Segment | Q3 2023 | Q3 2022 | Nine Months 2023 | Nine Months 2022 | | :--- | :--- | :--- | :--- | :--- | | Enclosures | $412.7 | $387.7 | $1,203.7 | $1,127.9 | | Electrical & Fastening Solutions | $302.3 | $209.2 | $774.7 | $597.7 | | Thermal Management | $143.8 | $148.3 | $424.0 | $441.8 | | **Total** | **$858.8** | **$745.2** | **$2,402.4** | **$2,167.4** | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=23&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q3 2023 sales growth driven by acquisitions and pricing, improved gross margins, and the financial impact of recent acquisitions on debt and segment performance [Consolidated Results of Operations](index=25&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated net sales increased 15.2% in Q3 2023, primarily due to acquisitions and pricing, leading to improved gross and operating margins despite volume declines Components of Net Sales Change (vs. Prior Year Period) | Component | Q3 2023 | Nine Months 2023 | | :--- | :--- | :--- | | Volume | (3.4%) | (1.6%) | | Price | 3.6% | 5.7% | | **Organic Growth** | **0.2%** | **4.1%** | | Acquisition | 14.0% | 7.1% | | Currency | 1.0% | (0.4%) | | **Total** | **15.2%** | **10.8%** | - Gross margin increased by **2.2 percentage points** in Q3 and **4.0 percentage points** in the first nine months of 2023, primarily due to increased selling prices and productivity improvements, partially offset by inflationary labor costs and **$11.8 million** of inventory step-up expense in Q3 related to the ECM acquisition[100](index=100&type=chunk)[102](index=102&type=chunk) - Net interest expense increased significantly to **$25.5 million** in Q3 2023 from **$8.1 million** in Q3 2022, mainly due to increased debt from the ECM Industries acquisition and higher variable interest rates[95](index=95&type=chunk)[101](index=101&type=chunk) [Segment Results of Operations](index=28&type=section&id=Segment%20Results%20of%20Operations) Segment results show strong sales growth in Enclosures and Electrical & Fastening Solutions (driven by acquisition), while Thermal Management experienced a sales decline - **Enclosures:** Q3 sales grew **6.4%** (**3.7% organic**) driven by pricing, with segment income margin increasing by **3.2 percentage points** to **21.7%** due to pricing and productivity[105](index=105&type=chunk)[106](index=106&type=chunk)[107](index=107&type=chunk) - **Electrical & Fastening Solutions:** Q3 sales grew **44.5%**, driven by a **47.0%** contribution from the ECM acquisition, while organic sales declined **3.7%**, with segment income margin increasing by **3.2 percentage points** to **32.3%** due to pricing and favorable product mix from the acquisition[109](index=109&type=chunk)[110](index=110&type=chunk)[113](index=113&type=chunk) - **Thermal Management:** Q3 sales decreased **3.0%** (**3.4% organic decline**) due to a **6.1%** volume drop, particularly in commercial & residential, with segment income margin flat at **24.2%** as pricing actions offset lower sales volume and cost inflation[114](index=114&type=chunk)[115](index=115&type=chunk)[117](index=117&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is supported by operating cash flow, with significant cash used for acquisitions funded by increased debt, while maintaining a revolving credit facility Free Cash Flow Reconciliation (Nine months ended Sep 30, in millions) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $291.6 | $199.8 | | Capital expenditures | $(48.9) | $(30.8) | | Proceeds from sale of property and equipment | $7.3 | $2.0 | | **Free cash flow** | **$250.0** | **$171.0** | - The company repurchased **0.3 million shares** for **$13.2 million** in the first nine months of 2023, with **$127.3 million** available for future repurchases under the current authorization expiring in July 2024[137](index=137&type=chunk)[138](index=138&type=chunk) - As of September 30, 2023, the company had **$113.3 million** of cash on hand and **$600.0 million** of borrowing capacity under its Revolving Credit Facility[118](index=118&type=chunk)[132](index=132&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=35&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company reports no material changes in its market risk during the quarter ended September 30, 2023 - There have been no material changes in market risk during the quarter[147](index=147&type=chunk) [Controls and Procedures](index=35&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of September 30, 2023 - The CEO and CFO concluded that disclosure controls and procedures were effective at a reasonable assurance level as of September 30, 2023[148](index=148&type=chunk) - The company is in the process of reviewing and integrating the internal controls and procedures of ECM Industries following its acquisition[149](index=149&type=chunk) [PART II OTHER INFORMATION](index=36&type=section&id=PART%20II%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity security purchases, and other relevant disclosures [Legal Proceedings](index=36&type=section&id=ITEM%201.%20Legal%20Proceedings) There have been no material developments in legal proceedings since the company's 2022 Annual Report on Form 10-K - No material developments have occurred with respect to previously disclosed legal proceedings[152](index=152&type=chunk) [Risk Factors](index=36&type=section&id=ITEM%201A.%20Risk%20Factors) The company has added new risk factors related to the acquisition of ECM Industries, including integration challenges, new liabilities, and increased debt leverage - New risk factors have been introduced related to the ECM Industries acquisition, including[153](index=153&type=chunk) - **Integration Risk:** Challenges in integrating ECM's operations could adversely affect financial results and delay or prevent the realization of expected synergies[154](index=154&type=chunk) - **New Risks and Liabilities:** The acquisition exposes the company to potential undisclosed liabilities and other risks that could be more costly than anticipated[155](index=155&type=chunk) - **Increased Leverage:** A material increase in total debt to **$1.9 billion** as of September 30, 2023, may harm financial condition by increasing cash requirements for interest payments and reducing financial flexibility[156](index=156&type=chunk) [Issuer Purchases of Equity Securities](index=37&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) During the third quarter of 2023, the company repurchased a total of 6,552 ordinary shares, including those surrendered by employees for tax obligations Share Repurchases in Q3 2023 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | July 1 - July 29, 2023 | 2,538 | $53.88 | | July 30 - August 26, 2023 | 3,069 | $54.67 | | August 27 - September 30, 2023 | 945 | $55.57 | | **Total** | **6,552** | **N/A** | - As of September 30, 2023, the company had **$127.3 million** available for share repurchases under the 2021 Authorization, which expires on July 22, 2024[162](index=162&type=chunk) [Other Information](index=38&type=section&id=ITEM%205.%20Other%20Information) During the third quarter of 2023, no directors or Section 16 officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - No directors or Section 16 officers adopted or terminated any Rule 10b5-1 trading arrangements during Q3 2023[163](index=163&type=chunk) [Exhibits](index=38&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed as part of the Quarterly Report on Form 10-Q, including CEO and CFO certifications and iXBRL data files

Financial Data and Key Metrics Changes - The company reported record sales of $859 million, up 15% year-over-year, with adjusted EPS increasing by 27% to $0.84 [66][60][35] - Segment income rose to $202 million, a 40% increase, with a return on sales of 23.5%, up 420 basis points year-over-year [44][60] - Free cash flow for the quarter was $136 million, reflecting an 8% increase compared to the previous year [67][60] Business Line Data and Key Metrics Changes - Enclosures segment sales increased by 6% to $413 million, with organic sales up 4% [45] - Electrical & Fastening segment sales surged by 45% to $302 million, primarily due to the ECM acquisition, although organic growth declined by 4% [46] - Thermal Management segment sales decreased by 3% to $144 million, with orders up mid-teens driven by energy transition projects [47][40] Market Data and Key Metrics Changes - North America led geographic sales growth with low-single-digit increases, while Europe was flat and China experienced a decline [45][64] - The company noted that project orders in the Thermal Management segment were up double-digits, indicating strong demand in that area [17] Company Strategy and Development Direction - The company is focused on the Electrification of Everything, sustainability, and digitalization trends, which are expected to drive future demand [73][106] - The company plans to continue investing in growth through acquisitions, new products, and geographic expansion, with a strong emphasis on high-growth verticals [58][75] - Legislative funding for infrastructure is anticipated to contribute between $250 million to $500 million in sales over the next five years [50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in 2024 being a solid growth year, driven by infrastructure spending and the ramp-up of legislative funding [2][106] - The company is optimistic about the energy transition and expects to see continued demand for liquid cooling solutions driven by AI [103][106] - Management acknowledged a mixed operating environment but highlighted strong execution and the potential for margin expansion [58][60] Other Important Information - The company raised its full-year adjusted EPS guidance to a range of $3.01 to $3.03, reflecting strong year-to-date performance [49] - The ECM and TEXA acquisitions are expected to contribute approximately 9 points to sales growth for the year [52] Q&A Session Summary Question: Can you elaborate on the 2024 growth environment? - Management indicated that they expect favorable comparisons in channel adjustments and a solid backlog build, particularly in Thermal Management and Data Solutions [82][106] Question: What is the status of cost synergies from the ECM acquisition? - Management reported that they are on track to achieve $10 million to $15 million in cost synergies, with some realized earlier than expected [119][143] Question: How is the company addressing the inventory adjustments in the channel? - Management noted that some channel partners are still adjusting inventories, which has impacted sales, but they expect improvements moving into Q4 [162][108] Question: What is the outlook for the Thermal Management business in China? - Management highlighted that the Thermal Management segment saw double-digit growth in China, driven by energy transition projects [47][161] Question: How does the company view the competitive landscape for liquid cooling? - Management acknowledged increased competition but emphasized their strong product portfolio and ongoing investments to capture market share [15][106]

Q3 2023 Financial Performance - Sales reached $859 million, a 15% increase year-over-year, with organic sales up slightly[19] - Segment income increased by 40% to $202 million, resulting in a Return on Sales (ROS) of 235%, a 420 bps expansion[19] - Adjusted EPS increased by 27% to $084[19] - Free cash flow increased by 8% to $136 million[19] Segment Performance - Enclosures sales increased by 6% to $413 million, with organic sales up 4% and ROS at 217% (+320bps)[10] - Electrical & Fastening sales increased by 45% to $302 million, but organic sales decreased by 4%, with ROS at 323% (+320bps); ECM Industries contributed $98 million to sales[10] - Management Thermal sales decreased by 3% to $144 million, with organic sales also down 3% and ROS at 242% (0bps)[10] Capital Allocation and Debt - Year-to-date, the company returned approximately $103 million in cash to shareholders[4] - Net debt to adjusted EBITDA ratio is at 24X[4] - The company maintains a strong liquidity position with $600 million available on revolver[4, 12] - The company has $113 million of cash on hand at quarter-end[14] 2023 Outlook - The company updated its full-year sales guidance to an increase of 12% to 13%, with organic sales up 3% to 4%[6] - Adjusted EPS guidance was updated to $301 to $303, an increase of 25% to 26%[6] - Acquisitions are expected to add approximately 9% to sales growth[6] - Capital expenditures are projected to be between $70 million and $75 million[6]

PART I FINANCIAL INFORMATION [Financial Statements (unaudited)](index=3&type=section&id=ITEM%201.%20Financial%20Statements%20(unaudited)) Presents unaudited condensed consolidated financial statements for Q2 2023, including income, balance sheet, cash flow, and equity, with detailed notes [Condensed Consolidated Statements of Income and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Net sales grew **10.4%** in Q2 and **8.5%** in H1 2023, driven by volume and pricing, leading to increased net income and diluted EPS Consolidated Income Statement Highlights (in millions, except per-share data) | Metric | Three months ended June 30, 2023 | Three months ended June 30, 2022 | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | $803.0 | $727.5 | $1,543.6 | $1,422.2 | | **Gross profit** | $331.9 | $267.8 | $635.1 | $515.1 | | **Operating income** | $146.7 | $104.7 | $270.8 | $194.8 | | **Net income** | $112.9 | $79.9 | $206.7 | $147.7 | | **Diluted EPS** | $0.67 | $0.48 | $1.23 | $0.88 | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$5.92 billion** from **$4.90 billion** due to acquisitions, with liabilities rising to **$3.05 billion** from **$2.17 billion** due to increased debt Balance Sheet Summary (in millions) | Account | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $138.5 | $297.5 | | Goodwill | $2,543.3 | $2,178.1 | | Intangibles, net | $1,547.5 | $1,066.1 | | **Total assets** | **$5,922.1** | **$4,902.2** | | Long-term debt | $1,938.8 | $1,068.2 | | **Total liabilities** | **$3,046.4** | **$2,170.5** | | **Total equity** | **$2,875.7** | **$2,731.7** | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow more than doubled to **$146.6 million** in H1 2023, with **$1.12 billion** used for acquisitions, funded by **$811.2 million** from financing activities Cash Flow Summary for Six Months Ended June 30 (in millions) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $146.6 | $63.9 | | Net cash used for investing activities | $(1,120.8) | $(27.4) | | Net cash provided by (used for) financing activities | $811.2 | $(19.7) | | **Change in cash and cash equivalents** | **$(159.0)** | **$6.3** | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes disclose revenue disaggregation, the **$1.1 billion** ECM Industries acquisition, increased goodwill and intangibles, new debt issuance, and segment performance - On May 18, 2023, the company acquired ECM Industries for approximately **$1.1 billion** in cash, funded primarily through new debt, as part of the Electrical & Fastening Solutions segment[37](index=37&type=chunk) - Goodwill increased by **$361.5 million** due to the ECM Industries acquisition, bringing the total to **$2.54 billion**, with identifiable intangible assets also rising significantly[39](index=39&type=chunk)[46](index=46&type=chunk) - To finance the ECM acquisition, the company issued **$500 million** in 5.650% Senior Notes due 2033 and entered into a new **$300 million** term loan facility, substantially increasing its long-term debt[59](index=59&type=chunk)[65](index=65&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 2023 financial performance, highlighting **10.4%** net sales growth driven by acquisition and pricing, segment results, liquidity, and increased debt from the ECM acquisition [Consolidated Results of Operations](index=25&type=section&id=Consolidated%20Results%20of%20Operations) Q2 2023 consolidated net sales increased **10.4%** to **$803.0 million**, driven by acquisition and pricing, with gross profit margin expanding and operating income rising **40.1%** Components of Net Sales Change (Q2 2023 vs Q2 2022) | Component | Percentage Change | | :--- | :--- | | Volume | (1.6%) | | Price | 5.5% | | **Organic growth** | **3.9%** | | Acquisition | 6.8% | | Currency | (0.3%) | | **Total** | **10.4%** | - Gross profit margin increased to **41.3%** in Q2 2023 from **36.8%** in Q2 2022, primarily due to price increases and savings from lean initiatives, offsetting inflationary cost pressures[94](index=94&type=chunk)[98](index=98&type=chunk) - Net interest expense increased significantly to **$21.7 million** in Q2 2023 from **$7.5 million** in Q2 2022, mainly due to increased debt from the ECM acquisition and higher interest rates[94](index=94&type=chunk)[99](index=99&type=chunk) [Segment Results of Operations](index=27&type=section&id=Segment%20Results%20of%20Operations) Q2 2023 saw Enclosures sales grow **5.0%** with **6.3** points margin expansion, Electrical & Fastening Solutions sales surge **32.8%** due to acquisition, and Thermal Management sales decline **6.5%** Segment Performance (Q2 2023 vs Q2 2022) | Segment | Net Sales Change | Segment Income Margin | Segment Income Margin Change | | :--- | :--- | :--- | :--- | | Enclosures | +5.0% | 22.5% | +6.3 pts | | Electrical & Fastening Solutions | +32.8% | 32.4% | +3.1 pts | | Thermal Management | -6.5% | 21.0% | +1.6 pts | [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) H1 2023 operating cash flow was **$146.6 million**, with the ECM acquisition financed by **$500 million** senior notes and a **$300 million** term loan, resulting in **$114.5 million** free cash flow - Free cash flow for the first six months of 2023 was **$114.5 million**, compared to **$45.1 million** for the same period in 2022[134](index=134&type=chunk) - The company issued **$500 million** of 5.650% Senior Notes due 2033 and entered a new **$300 million** term loan facility to fund the ECM acquisition[120](index=120&type=chunk)[126](index=126&type=chunk) - As of June 30, 2023, the company had **$127.3 million** available for share repurchases under its 2021 authorization[131](index=131&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=34&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) No material changes in market risk occurred during Q2 2023 compared to the 2022 Annual Report disclosures - There have been no material changes in market risk during the quarter ended June 30, 2023[139](index=139&type=chunk) [Controls and Procedures](index=34&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of June 30, 2023, and is integrating ECM Industries' internal controls - The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2023[140](index=140&type=chunk) - The company is currently integrating the internal controls and procedures of the recently acquired ECM Industries[141](index=141&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=35&type=section&id=ITEM%201.%20Legal%20Proceedings) No material developments in legal proceedings have occurred since the 2022 Annual Report disclosures - There have been no material developments with respect to legal proceedings previously disclosed in the 2022 Annual Report[143](index=143&type=chunk) [Risk Factors](index=35&type=section&id=ITEM%201A.%20Risk%20Factors) New risk factors include integration difficulties, failure to realize acquisition benefits, and increased financial risk from higher debt and leverage - The company may not realize the anticipated benefits of the ECM Industries acquisition, and integration could present unexpected difficulties[145](index=145&type=chunk) - The company's total debt increased to **$2.0 billion** as of June 30, 2023, due to financing the ECM acquisition, which increases financial risk and vulnerability to adverse economic conditions[147](index=147&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details share repurchase activities for Q2 2023, with **$127.3 million** remaining available under the 2021 authorization - As of June 30, 2023, the company had **$127.3 million** available for share repurchases under the 2021 Authorization, which expires in July 2024[153](index=153&type=chunk) [Other Information](index=37&type=section&id=ITEM%205.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 trading arrangements during Q2 2023 - During Q2 2023, no directors or executive officers adopted or terminated any Rule 10b5-1 trading arrangements[154](index=154&type=chunk) [Exhibits](index=37&type=section&id=ITEM%206.%20Exhibits) Provides an index of exhibits for the Quarterly Report on Form 10-Q, including acquisition agreements and CEO/CFO certifications

nVent Electric PLC (NYSE:NVT) Q2 2023 Earnings Conference Call July 28, 2023 9:00 AM ET Company Participants Tony Riter - Vice President of Investor Relations Beth Wozniak - Chief Executive Officer & Director Sara Zawoyski - Executive Vice President & Chief Financial Officer Conference Call Participants Julian Mitchell - Barclays Bank Deane Dray - RBC Capital Markets Jeff Hammond - KeyBanc Capital Markets Joseph Ritchie - Goldman Sachs Group Jeffrey Sprague - Vertical Research Partners Nigel Coe - Wolfe Res ...

Reported to Adjusted 2021 Reconciliation nVent Electric plc Reconciliation of GAAP to non-GAAP financial measures for the year ended December 31, 2021 excluding the effect of adjustments (Unaudited) | --- | --- | --- | --- | --- | --- | --- | --- | --- | |---------------------------------------------------------------------------|---------------|-------|----------------|---------------|-------|----------------|-------|-----------| | In millions, except per-share data | First Quarter | | Second Quarter | Thi ...

PART I FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=ITEM%201.%20Financial%20Statements%20(unaudited)) Q1 2023 unaudited financials report strong net income growth, stable assets, improved cash flow, and a major acquisition [Condensed Consolidated Statements of Income and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Q1 2023 vs Q1 2022 Income Statement Highlights | Metric | Q1 2023 (in millions) | Q1 2022 (in millions) | Change | | :--- | :--- | :--- | :--- | | Net Sales | $740.6 | $694.7 | +6.6% | | Gross Profit | $303.2 | $247.3 | +22.6% | | Operating Income | $124.1 | $90.1 | +37.7% | | Net Income | $93.8 | $67.8 | +38.3% | | Diluted EPS | $0.56 | $0.40 | +40.0% | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance Sheet Highlights (Mar 31, 2023 vs Dec 31, 2022) | Account | Mar 31, 2023 (in millions) | Dec 31, 2022 (in millions) | | :--- | :--- | :--- | | Cash and cash equivalents | $303.1 | $297.5 | | Total current assets | $1,251.8 | $1,229.2 | | Goodwill | $2,180.5 | $2,178.1 | | Total assets | $4,916.4 | $4,902.2 | | Total current liabilities | $601.3 | $649.5 | | Long-term debt | $1,064.6 | $1,068.2 | | Total equity | $2,789.9 | $2,731.7 | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2023 vs Q1 2022 Cash Flow Summary | Activity | Q1 2023 (in millions) | Q1 2022 (in millions) | | :--- | :--- | :--- | | Net cash from operating activities | $69.4 | $6.5 | | Net cash used for investing activities | ($16.9) | ($9.2) | | Net cash (used for) provided by financing activities | ($50.8) | $5.9 | | Change in cash and cash equivalents | $5.6 | $1.6 | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) - On April 1, 2023, the company entered into a definitive agreement to acquire ECM Industries, LLC for a purchase price of **$1.1 billion**, with the acquisition expected to close in the second quarter of 2023[31](index=31&type=chunk) - To finance the ECM Industries acquisition, the company arranged a **$300.0 million** senior unsecured term loan facility and a public offering of **$500.0 million** in 5.650% Senior Notes due 2033[33](index=33&type=chunk)[34](index=34&type=chunk) Q1 2023 Revenue by Segment | Segment | Q1 2023 Net Sales (in millions) | Q1 2022 Net Sales (in millions) | | :--- | :--- | :--- | | Enclosures | $391.0 | $359.4 | | Electrical & Fastening Solutions | $205.7 | $187.6 | | Thermal Management | $143.9 | $147.7 | | **Total** | **$740.6** | **$694.7** | Q1 2023 Segment Income | Segment | Q1 2023 Segment Income (in millions) | Q1 2022 Segment Income (in millions) | | :--- | :--- | :--- | | Enclosures | $82.5 | $50.3 | | Electrical & Fastening Solutions | $61.3 | $47.1 | | Thermal Management | $30.9 | $32.4 | | **Total** | **$148.0** | **$110.2** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reports net sales growth, expanded gross margin, strong segment performance, a key acquisition, and robust liquidity [Overview and Key Trends](index=19&type=section&id=Overview%20and%20Key%20Trends) - The company operates across three segments: Enclosures (**53%** of Q1 2023 revenue), Electrical & Fastening Solutions (**28%**), and Thermal Management (**19%**)[79](index=79&type=chunk) - A definitive agreement was signed on April 1, 2023, to acquire ECM Industries for **$1.1 billion**, which will be integrated into the Electrical & Fastening Solutions segment upon closing[81](index=81&type=chunk) - Key trends include moderating supply chain challenges, continued cost inflation, economic uncertainty, and strategic objectives focused on growth, the ECM acquisition, digital transformation, and supply chain resiliency[82](index=82&type=chunk) [Consolidated Results of Operations](index=22&type=section&id=Consolidated%20Results%20of%20Operations) Components of Net Sales Change (Q1 2023 vs Q1 2022) | Component | Percentage Change | | :--- | :--- | | Volume | +0.3% | | Price | +8.1% | | **Organic Growth** | **+8.4%** | | Currency | -1.8% | | **Total** | **+6.6%** | - Gross profit margin increased by **5.3 percentage points** to **40.9%**, primarily due to higher selling prices and productivity savings offsetting inflationary labor costs[84](index=84&type=chunk)[87](index=87&type=chunk) - SG&A expense as a percentage of net sales increased by **1.5 percentage points** to **21.9%**, driven by inflation, higher restructuring and acquisition costs (**$6.3 million** in Q1 2023 vs **$2.3 million** in Q1 2022), and growth investments[88](index=88&type=chunk)[92](index=92&type=chunk) [Segment Results of Operations](index=23&type=section&id=Segment%20Results%20of%20Operations) - **Enclosures:** Net sales grew **8.8%** (**10.7%** organic), driven by strong price realization (**+8.5%**) and volume growth (**+2.2%**), expanding segment income margin by **7.1 percentage points** to **21.1%**[92](index=92&type=chunk)[93](index=93&type=chunk)[95](index=95&type=chunk) - **Electrical & Fastening Solutions:** Net sales increased **9.6%** (**10.9%** organic), primarily from strong pricing (**+10.8%**), with segment income margin growing by **4.7 percentage points** to **29.8%** due to pricing and favorable product mix[96](index=96&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) - **Thermal Management:** Net sales decreased **2.6%** (**-0.2%** organic) due to a **4.0%** volume decline offsetting **3.8%** price increases, primarily in commercial & residential business, leading to a slight **0.4 percentage point** segment income margin contraction to **21.5%** from inflation, lower volume, and unfavorable mix[101](index=101&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) [Liquidity and Capital Resources](index=27&type=section&id=Liquidity%20and%20Capital%20Resources) - The company ended Q1 2023 with **$303.1 million** in cash and cash equivalents and **$600.0 million** available under its Revolving Credit Facility[107](index=107&type=chunk)[119](index=119&type=chunk) Free Cash Flow Reconciliation (Q1 2023 vs Q1 2022) | Metric (in millions) | Q1 2023 | Q1 2022 | | :--- | :--- | :--- | | Net cash from operating activities | $69.4 | $6.5 | | Capital expenditures | ($17.1) | ($11.1) | | Proceeds from sale of property | $0.2 | $1.9 | | **Free cash flow** | **$52.5** | **($2.7)** | - During Q1 2023, the company repurchased **0.3 million** shares for **$13.2 million** and paid dividends of **$29.3 million**[126](index=126&type=chunk)[127](index=127&type=chunk) - As of March 31, 2023, **$127.3 million** remained available for share repurchases under the 2021 Authorization, expiring in July 2024[126](index=126&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=30&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company reports no material changes in its market risk during the quarter ended March 31, 2023 - There have been no material changes in market risk during the quarter ended March 31, 2023[133](index=133&type=chunk) [Item 4. Controls and Procedures](index=30&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2023 - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2023[134](index=134&type=chunk) - No changes occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[135](index=135&type=chunk) PART II OTHER INFORMATION [Item 1. Legal Proceedings](index=31&type=section&id=ITEM%201.%20Legal%20Proceedings) There have been no material developments in legal proceedings since the disclosures in the 2022 Annual Report on Form 10-K - No material developments have occurred with respect to legal proceedings previously disclosed in the 2022 Annual Report on Form 10-K[138](index=138&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=ITEM%201A.%20Risk%20Factors) The company has identified new risk factors related to the pending acquisition of ECM Industries, including integration challenges and increased financial leverage - New risk factors have been introduced related to the acquisition of ECM Industries[139](index=139&type=chunk) - Key risks include challenges in integrating ECM's operations, which could delay or prevent the realization of expected synergies and cost savings[140](index=140&type=chunk) - The company's indebtedness is expected to increase materially by approximately **$800.0 million** to finance the acquisition, potentially harming its financial condition and reducing flexibility[142](index=142&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q1 2023, the company repurchased **512,422** shares, with **$127.3 million** remaining for future repurchases Share Repurchases in Q1 2023 | Period | Total Shares Purchased | Average Price Paid | Shares Purchased as Part of Plan | | :--- | :--- | :--- | :--- | | Jan 1 - Jan 28, 2023 | 349,133 | $38.60 | 342,830 | | Jan 29 - Feb 25, 2023 | 4,784 | $40.69 | — | | Feb 26 - Mar 31, 2023 | 158,505 | $45.83 | — | | **Total** | **512,422** | | **342,830** | - As of March 31, 2023, the company had **$127.3 million** available for share repurchases under the 2021 Authorization, which expires on July 22, 2024[148](index=148&type=chunk) [Item 6. Exhibits](index=33&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed as part of the Quarterly Report on Form 10-Q, including key agreements and officer certifications - Key exhibits filed with this report include the Loan Agreement dated April 26, 2023, and the Merger Agreement for the ECM Industries acquisition dated April 1, 2023[151](index=151&type=chunk)

nVent Electric PLC (NYSE:NVT) Q1 2023 Earnings Conference Call April 28, 2023 9:00 AM ET Company Participants Tony Riter - VP, IR Beth Wozniak - CEO & Director Sara Zawoyski - EVP & CFO Conference Call Participants Julian Mitchell - Barclays Bank Deane Dray - RBC Capital Markets Joseph Ritchie - Goldman Sachs Group Jeffrey Sprague - Vertical Research Partners Jeffrey Hammond - KeyBanc Capital Markets Scott Graham - Loop Capital Markets Nigel Coe - Wolfe Research Operator Good morning, everyone, and welcome ...

Up 4% to 6% organic ▪ Corporate costs ~$95M nVent Strategy Adjusted EBITDA Margin* Reported to Adjusted 2023 Reconciliation No change ▪ Secular tailwinds continue in electrification Q2 2023 nVent Outlook* 12 Q1 '23 Earnings Presentation Extraordinary and non-recurring costs primarily consist of integration and consolidation costs related to historical ECM acquisitions, financial sponsor management fees, and non-recurring professional fees and transaction costs Q1 '23 Earnings Presentation nVent First Quarte ...