Crane pany(US:CR)2026-01-27 16:00Financial Data and Key Metrics Changes - Adjusted EPS for Q4 2025 was $1.53, up 21% year-over-year, driven by a 5.4% core sales growth [5][30] - For the full year 2025, adjusted EPS increased by 24%, reflecting strong performance and customer satisfaction [5] - Core FX neutral backlog increased by 14% year-over-year, indicating strong demand [30] Business Line Data and Key Metrics Changes - Aerospace and Advanced Technologies segment sales reached $272 million, a 15% increase, primarily organic growth [30] - Process Flow Technologies segment sales were $309 million, flat compared to the previous year, with core sales down 1.5% [33][34] - Adjusted segment margin for Aerospace and Advanced Technologies expanded to 23.6%, up 50 basis points from the previous year [33] Market Data and Key Metrics Changes - The commercial aerospace market remains strong, with Boeing and Airbus ramping up production [16] - Defense procurement spending is solid, with a focus on strengthening the defense industrial base amid global uncertainties [16] - Chemical markets remain subdued, impacting the Process Flow Technologies segment [34][56] Company Strategy and Development Direction - The company aims for 4%-6% core sales growth and 35%-40% core operating leverage, with a focus on long-term value creation [4] - Recent acquisitions, including Druck, Panametrics, and Reuter-Stokes, are expected to enhance growth and support existing and new customers [5][9] - The company plans to expand its Aerospace and Advanced Technologies segment by exploring adjacent markets and technologies [8][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength and resilience of the company’s team and portfolio, anticipating strong performance in 2026 [11] - The guidance for 2026 includes an adjusted EPS of $6.55-$6.75, reflecting a solid growth outlook [12] - The company expects core sales growth in Aerospace and Advanced Technologies to be at the high end of the long-term growth assumption of 7%-9% [16] Other Important Information - The company has a planned succession timeline, with Alex Alcala set to become CEO on April 27, 2026 [10] - The integration process for recent acquisitions is underway, with expectations for these businesses to be slightly accretive to earnings in 2026 [22][23] - Corporate expenses for 2026 are anticipated to be in the range of $80 million-$85 million [36] Q&A Session Summary Question: What are the pricing opportunities at Druck in 2026 and 2027? - Management indicated significant pricing opportunities and expects improvements starting this year, with no obstacles to achieving goals [41][42] Question: Can you clarify what guidance contemplates regarding cost takeout at PSI? - Management confirmed that there are no changes to previously discussed cost takeout plans, which include productivity improvements and leveraging growth [43][44] Question: Can you discuss the strategic direction of the Aerospace and Advanced Technologies segment? - Management explained that the renaming to AAT reflects a broader focus on adjacent technologies and strategic growth opportunities [52] Question: What is the outlook for the chemical market in 2026? - Management expects the chemical market to remain sluggish, with no strong uptick anticipated in 2026 [56][58] Question: What are the expected synergies from the recent acquisitions? - Management stated that while synergies are not included in the initial financial model, they anticipate growth synergies from the acquisitions over time [101][104]