Company Performance - SPX Technologies (SPXC) has achieved a year-to-date performance increase of approximately 48.2%, significantly outperforming the average return of 8.4% for the Business Services sector [4] - The Zacks Consensus Estimate for SPXC's full-year earnings has increased by 3.3% over the past quarter, indicating improved analyst sentiment and a stronger earnings outlook [3] Industry Ranking - SPX Technologies is part of the Technology Services industry, which consists of 171 companies and currently ranks 88 in the Zacks Industry Rank. This industry has seen an average gain of 20.4% year-to-date, with SPXC outperforming this average [5] - The Business Services group, which includes SPX Technologies, ranks 5 within the Zacks Sector Rank, which encompasses 16 different groups [2] Comparison with Peers - Envestnet (ENV), another company in the Business Services sector, has returned 27.2% year-to-date and also holds a Zacks Rank of 2 (Buy) [4][5] - The Financial Transaction Services industry, to which Envestnet belongs, is ranked 84 and has experienced a 6% increase this year [6]

Core Viewpoint - SPX Technologies reported strong quarterly earnings, surpassing estimates and showing significant year-over-year growth in both earnings and revenues [1][2]. Financial Performance - The company achieved quarterly earnings of $1.42 per share, exceeding the Zacks Consensus Estimate of $1.26 per share, and up from $1.06 per share a year ago, representing an earnings surprise of 12.70% [1]. - Revenues for the quarter reached $501.3 million, surpassing the Zacks Consensus Estimate by 2.11%, and increased from $423.3 million in the same quarter last year [2]. Market Performance - SPX Technologies shares have appreciated approximately 46.1% since the beginning of the year, significantly outperforming the S&P 500's gain of 15.8% [3]. Future Outlook - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at $1.32 for the next quarter and $5.37 for the current fiscal year, alongside projected revenues of $503.2 million and $2 billion respectively [7]. - The Zacks Rank for SPX Technologies is currently 2 (Buy), indicating expectations for the stock to outperform the market in the near future [6]. Industry Context - The Technology Services industry, to which SPX Technologies belongs, is currently ranked in the top 38% of over 250 Zacks industries, suggesting a favorable environment for stock performance [8].

Group 1: Company Performance - SPX Technologies has returned 47.2% year-to-date, significantly outperforming the average return of 8.5% for Business Services companies [6] - Seagate has achieved a year-to-date return of 21.1%, also outperforming the Business Services sector [7] - SPX Technologies holds a Zacks Rank of 2 (Buy), indicating a strong earnings outlook [5][6] Group 2: Earnings Estimates - The consensus EPS estimate for Seagate has increased by 32.3% over the past three months, reflecting improved analyst sentiment [2] - SPX Technologies' full-year earnings estimate has moved 6.3% higher in the past quarter, indicating a stronger earnings outlook [6] Group 3: Industry Context - SPX Technologies is part of the Technology Services industry, which consists of 170 companies and currently ranks 87 in the Zacks Industry Rank [8] - The Technology Services industry has gained an average of 18% year-to-date, with SPX Technologies outperforming this average [8]

Core Viewpoint - SPX Technologies (SPXC) is anticipated to report a year-over-year increase in earnings driven by higher revenues, with the consensus EPS estimate at $1.26, reflecting an 18.9% increase from the previous year [2][4]. Earnings Expectations - The earnings report is scheduled for August 1, 2024, and could influence the stock price positively if results exceed expectations, while a miss could lead to a decline [3]. - Revenues are projected to reach $490.93 million, marking a 16% increase from the same quarter last year [5]. Estimate Revisions - The consensus EPS estimate has been revised down by 0.75% over the last 30 days, indicating a reassessment by analysts [6]. - The Most Accurate Estimate for SPX Technologies is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +1.59%, suggesting a likelihood of beating the consensus EPS estimate [12][13]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) [10]. - SPX Technologies has a history of delivering earnings surprises, with a previous quarter's earnings of $1.25 per share exceeding expectations of $1.06, resulting in a surprise of +17.92% [19]. Industry Comparison - Another player in the industry, Parsons, is expected to report earnings of $0.66 per share, reflecting a year-over-year change of +4.8%, with revenues projected at $1.53 billion, up 12.8% from the previous year [22]. - Parsons has a Zacks Rank of 2 (Buy) but has a negative Earnings ESP of -0.97%, making it difficult to predict an earnings beat conclusively [16][23]. Conclusion - SPX Technologies is positioned as a compelling candidate for an earnings beat, but investors should consider other factors influencing stock performance beyond earnings results [21].

Call Access: To access the call by phone, please use the following link to receive dial-in details https://register.vevent.com/register/BI897f7ff93cf54486873d06ecf7d4508e. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time. A replay of the webcast will also be available for a limited time at www.spx.com. In conjunction with this announcement, SPX Technologies' President and Chief Executive Officer Gene Lowe and SPX Technologies' Vice ...

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Financial Data and Key Metrics Changes - In Q1 2024, the company reported a revenue growth of 16.4% year-on-year and adjusted EBITDA growth of 47% with a margin expansion of 410 basis points [3][9] - Adjusted EPS increased by 34% to $1.25, while segment income grew by $20.7 million or 43.4% [9][10] - The company ended Q1 with cash of $106 million and total debt of $855 million, resulting in a leverage ratio of 2x [13][14] Business Line Data and Key Metrics Changes - In the HVAC segment, revenues grew by 20.2% year-on-year, with acquisitions contributing 22.2% to this growth [31] - Detection & Measurement segment revenues increased by 9.9% year-on-year, driven by organic sales growth and a modest FX tailwind [11][12] - Segment backlog at quarter-end was $462 million for HVAC and $207 million for Detection & Measurement, reflecting a 20% organic increase for HVAC but a 16% organic decline for Detection & Measurement [11][108] Market Data and Key Metrics Changes - The company continues to experience robust demand across key markets, particularly in HVAC for cooling products in data centers, semiconductor plants, and industrial facilities [18] - Detection & Measurement is seeing flattish global demand with regional variations, while project orders remain healthy [18] Company Strategy and Development Direction - The company is focused on leveraging its business system to drive value through growth investments, strategic M&A, and continuous improvement initiatives [4][5] - The new framework targets average EBITDA growth of over 15% annually at margins exceeding 20% [4] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the updated full-year guidance, which implies a 30% growth in adjusted EBITDA [26] - The company anticipates a sequential revenue increase in HVAC for Q2 due to the full quarter impact of the Ingénia acquisition and increased cooling production capacity [15][16] Other Important Information - The company raised its full-year guidance for adjusted EPS to a range of $5.15 to $5.40, reflecting strong Q1 results and a robust demand outlook [14] - The company expects HVAC revenue to be in the range of $1.36 billion to $1.4 billion, an increase of $30 million at the midpoint from prior guidance [15] Q&A Session Summary Question: What is driving the increase in HVAC margins? - Management indicated that the increase in HVAC margins is primarily driven by higher revenue drop-through at attractive gross margins, with acquisitions integrating well and expected to contribute higher margins than previously anticipated [41][35] Question: How did orders trend through Q1 and into early Q2 for Detection & Measurement? - Management noted that orders were less than 1 in D&M, with expectations for flat revenue and profit contributions for the year, primarily due to the impact of a large project delivered last year [38][73] Question: What is the outlook for the locators and inspection platform? - Management expects the locators and inspection platform to be flattish this year, with meaningful growth in the U.S. but slower performance in Europe and Asia [100] Question: How is the backlog looking for Detection & Measurement? - The backlog for Detection & Measurement was reported at $207 million, with management feeling good about the project activity and pipeline for 2024 and beyond [108][110]

Long-term debt MAY 2, 2024 1 Reconciliations of non-GAAP guidance measures to US GAAP financial measures are not practicable and accordingly are not included in the Appendix to this presentation. 20 | Major product lines (1) Adjustment represents the removal of certain acquisition and strategic/transformation related costs ($2.4). (2) Adjustment represents the removal of (i) integration costs of $1.7 and (ii) an inventory step-up charge related to the Ingénia acquisition of $0.9 within the HVAC reportable s ...

Financial Performance - Q1 2024 revenue was $465.2 million, up 16.4% from $399.8 million in Q1 2023[3] - Q1 2024 net income increased to $49.0 million, compared to $42.8 million in Q1 2023, reflecting a year-on-year growth of 5.0%[3] - Adjusted EPS for Q1 2024 was $1.25, a 34.4% increase from $0.93 in Q1 2023[4] - Adjusted EBITDA for Q1 2024 was $92.0 million, representing a 46.7% increase from $62.7 million in Q1 2023[4] - Operating income rose to $64.6 million, representing a 29.7% increase compared to $49.8 million in the prior year[30] - Net income for the period was $49.0 million, compared to $42.8 million in the previous year, reflecting a growth of 14.5%[32] - Basic income per share from continuing operations increased to $1.07, up from $0.86 year-over-year[26] - The company reported an adjusted EBITDA of $92.0 million for the three months ended March 30, 2024, which is 19.8% of revenues, compared to $62.7 million or 15.7% of revenues in the prior year[44] - SPX Technologies' earnings per share from continuing operations increased to $1.25 for the three months ended March 30, 2024, up from $0.93 in the same period last year[39] Segment Performance - The HVAC segment reported revenue of $302.4 million, a 20.2% increase, driven by acquisitions and a favorable product mix[6] - Detection & Measurement segment revenue grew by 9.9% to $162.8 million, with a 9.6% increase in organic revenue[9] - HVAC segment income margin improved to 22.6% in Q1 2024, up from 19.0% in Q1 2023[7] - Net revenue growth in the HVAC segment was 20.2%, while the Detection & Measurement segment saw a growth of 9.9%[36] - The HVAC reportable segment generated revenues of $302.4 million, a 20.2% increase from $251.6 million in the prior year[30] - The Detection & Measurement reportable segment saw revenues of $162.8 million, a 9.9% increase from $148.2 million year-over-year[30] Guidance and Projections - Full-year 2024 adjusted EPS guidance raised to a range of $5.15 to $5.40, implying approximately 23% year-on-year growth[2] - Full-year 2024 revenue guidance increased to $1.965-$2.025 billion, up from the previous range of $1.93-$2.00 billion[12] Balance Sheet and Cash Flow - Total outstanding debt as of March 30, 2024, was $854.4 million, with total cash of $105.5 million[11] - Total current assets increased to $779.6 million, up from $709.6 million at the end of December 2023[28] - Total liabilities rose to $1,562.1 million, compared to $1,245.1 million at the end of December 2023[28] - Cash and equivalents at the end of the period were $105.5 million, down from $212.7 million at the end of the previous year[32] - The company reported a total stockholders' equity of $1,237.5 million, an increase from $1,194.6 million at the end of December 2023[28] - The company had a beginning cash balance of $104.9 million and an ending cash balance of $105.5 million, reflecting a net increase of $0.6 million during the quarter[34] - Total debt increased from $854.4 million at the end of December 2023 to $622.2 million by March 30, 2024, primarily due to borrowings under senior credit facilities[34] Other Financial Metrics - Acquisition-related costs for the three months ended March 30, 2024, amounted to $5.0 million, compared to $2.1 million in the same period last year[38] - The adjusted operating income for the same period was $84.4 million, which is 18.1% of revenues, compared to $58.3 million or 14.6% of revenues a year ago[38] - Organic revenue growth in the HVAC segment declined by 1.9%, while the Detection & Measurement segment experienced a growth of 9.6%[36]

Financial Data and Key Metrics Changes - Total company revenues increased by 9.3% year-on-year, driven by acquisitions, while organic revenue declined modestly [5][72] - Segment income grew by $12.3 million or 13.6% to $102.8 million, with segment margin increasing by 80 basis points [5][72] - Adjusted EPS guidance for 2024 is set at $4.85 to $5.15, reflecting a 16% growth at the midpoint over 2023 results [8][67] Business Line Data and Key Metrics Changes - In the Detection & Measurement segment, revenues increased by 1.2% year-on-year, with flat organic sales and a modest FX tailwind [6][80] - HVAC segment revenue is anticipated to be in the range of $1.325 billion to $1.375 billion, reflecting an increase of approximately 20% at the midpoint [92] - The APAC segment saw revenues grow by 14% year-on-year, with acquisitions contributing 15.7% to this growth [76] Market Data and Key Metrics Changes - Organic revenue in the heating segment declined by 2%, driven by lower sales associated with unseasonably warm weather [64] - The backlog for the HVAC segment remained healthy at $306 million, up approximately 13% organically compared to the prior year [77] - Detection & Measurement segment revenue is expected to be in the range of $605 million to $630 million, with the midpoint almost flat with the prior year [80] Company Strategy and Development Direction - The company is focused on inorganic growth initiatives, having completed three significant acquisitions in the past year [14][66] - The acquisition of Ingenia is expected to enhance the company's capabilities in engineered air movement and broaden growth opportunities [69][88] - The company aims to achieve adjusted EBITDA growth of 25% and adjusted EPS growth of 16% in 2024, positioning itself to meet 2025 targets a year early [67][91] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth opportunities, citing a strong strategy and capable team [11] - The company anticipates a significant reduction in contact project sales in the Detection & Measurement segment, following the completion of a large project order [9] - Management noted that while the run rate business is flat, there is no downward pressure currently observed [17][86] Other Important Information - The company ended Q4 with cash of $105 million and total debt of $558 million, with a leverage ratio declining to 1.3 times [60] - Full year adjusted free cash flow was $231 million, approximately 115% of adjusted net income [79] - The company launched an advanced solution for precision location and mapping of underground utilities, enhancing its Location and Inspection platform [63] Q&A Session Summary Question: Comments on D&M results and run rate progression - Management acknowledged that D&M results were lower than anticipated due to a mix issue and weakening run rate, but noted no current downward pressure [12][16] Question: Insights on Ingenia acquisition and growth prospects - Management highlighted Ingenia's strong reputation and technological advantages, expecting it to contribute positively to revenue and margins [31][32] Question: Working capital expectations for 2024 - Management indicated that working capital is approaching normalized levels, with expectations for cash inflow from working capital in 2024 [56][79] Question: HVAC margin outlook and operational improvements - Management expressed confidence in HVAC margins for 2024, citing strong demand and operational improvements [34][110] Question: Impact of weather on heating sales - Management noted that warm weather has affected heating sales, but emphasized resilience in the US market compared to Europe [104][133]