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The call was strongly positive: the company delivered record top-line and bottom-line results, materially raised full-year and Q2 guidance, and reported robust orders and backlog—largely driven by Infrastructure and data-center demand (notably liquid cooling). Financial position and capital allocation remain disciplined with strong liquidity and low leverage. Key headwinds include tariff and inflation pressures (notably copper), margin pressure in the Electrical Connections segment, Asia Pacific weakness, and the near-term challenges of ramping new capacity and supply-base scaling. On balance, the positive operational momentum, guidance raises, and cash/balance-sheet strength significantly outweigh the transitory margin and macro headwinds.
Management raised full‑year guidance, now forecasting reported sales growth of 26%–28% (including ~5 points from acquisitions and flattish FX) with organic sales up 21%–23% (vs prior 10%–13%), and increased full‑year adjusted EPS to $4.45–$4.55 (from $4.00–$4.15) while assuming approximately $80M of incremental tariff headwinds; they expect free cash flow conversion of 90%–95%, plan ~ $130M in CapEx (up ~40%) with Q2 guidance of reported sales +28%–30% (organic +23%–25%, ~5 points from acquisitions) and adjusted EPS of $1.12–$1.15 (midpoint >30% YoY); liquidity and balance‑sheet metrics cited to support the plan include $109M cash, $600M available on the revolver, $1.6B of debt, net leverage of 1.5x (well below the 2.0–2.5x target), and a $2.6B backlog.
Q1 reported sales $1.242B, up 53% year-over-year; organic sales +34%. Third consecutive quarter with sales >$1B. Organic orders up ~40%; backlog grew sequentially to $2.6B (up low double digits), providing multi-quarter visibility.
Adjusted operating income $249M, up 53% YoY; adjusted EPS $1.09, up 63% (first quarterly adjusted EPS > $1). Free cash flow $54M, up 21% YoY; company expects free cash flow conversion of 90–95% for the year.
Infrastructure vertical led growth: Infrastructure now >55% of sales (vs 12% at spin), Infrastructure organic sales nearly +80% driven by data centers. Data center strength across gray (engineered buildings, enclosures, power connections) and white space (liquid cooling, PDUs, cable management).
New products contributed over 20 percentage points to sales growth in Q1; 11 new products launched in the quarter. Liquid cooling and other data-center-focused NPIs were major contributors to the strong performance.
Systems Protection sales $895M, +70% YoY (organic +50%). Segment income $203M, up 95% YoY; return on sales 22.7%, up ~220 basis points, reflecting significant operating leverage.
Acquisitions contributed $138M to sales (≈17 points of growth); EPG exceeded expectations with strong double-digit sales growth and accretive margin/earnings contributions. Trackd and EPG providing modular/utility growth opportunities.
Full-year reported sales growth raised to 26–28%; full-year organic growth raised to 21–23% (prior 10–13%). Full-year adjusted EPS raised to $4.45–$4.55 (prior $4.00–$4.15). Q2 organic sales growth guided to 23–25%; Q2 adjusted EPS $1.12–$1.15.
Net leverage 1.5x (below 2–2.5x target range). Cash on hand $109M; $600M available on revolver. Returned $84M to shareholders in Q1 (including $50M buybacks) and increased quarterly dividend by 5%. CapEx guidance ~$130M for year (up ~40%), with Q1 CapEx $36M (up >70% YoY) focused on capacity expansion.
Published 2025 Sustainability Report: normalized CO2 emissions reduced 24%; 100% of new products launched last year moved away from single-use plastic packaging; recognized by Ethisphere and received EcoVadis gold (top 2% of industry).
Good day, and welcome to the nVent Electric plc First Quarter 2026 Earnings Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Tony Riter, Vice President of Investor Relations. Please go ahead.
Thank you, and welcome to nVent Electric plc's first quarter 2026 earnings call. On the call with me are Beth A. Wozniak, chair and chief executive officer, and Gary Corona, our chief financial officer. Today, we will provide details on our first quarter performance and outlook for the second quarter and an update to our full year outlook. All results referenced throughout this presentation are on a continuing operations basis unless otherwise stated. Before we begin, let me remind you that any statements made about the company's anticipated financial results are forward-looking statements, subject to future risks and uncertainties, such as the risks outlined in today's press release and nVent Electric plc's filings with the Securities and Exchange Commission. Forward-looking statements are made as of today; the company undertakes no obligation to update publicly such statements to reflect subsequent events or circumstances. Actual results could differ materially from anticipated results.
Today's webcast is accompanied by a presentation which you can find in the Investors section of nVent Electric plc's website. References to non-GAAP financials are reconciled in the appendix of the presentation. We will have ...