Littelfuse, Inc.

Good day, everyone, and welcome to the Little Fuse First Quarter 2023 Earnings Conference Call. Today's call is being recorded. At this time, I will turn the call over to the Head of Investor Relations, Tricia Tuntland. Please proceed.

Good morning, and welcome to the Little Fuse First Quarter 2023 Earnings Conference Call. With me today are Dave Heinzman, President and CEO, Aminul Sethna, Executive Vice President and CFO. Yesterday, We reported results for our first quarter, and a copy of our earnings release and slide presentation is available in the investor relations section of our website. A webcast of today's conference call will also be available on our website. Please advance to slide two for our disclaimers. Our discussions today will include forward-looking statements. These forward-looking statements may involve significant risks and uncertainties. Please review yesterday's press release and our forms 10-K and 10-Q for more detail about important risks that could cause actual results to differ materially from our expectations. We assume no obligation to update any of this forward-looking information. Also, our remarks today refer to non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure is provided in our earnings release available in the investor relations section of our website. I will now turn the call over to Dave.

Thank you, Tricia. Good morning and thanks for joining us today. Let's start with highlights on slide four. Our global teams delivered strong first quarter results above our sales and adjusted EPS guidance within a tougher electronics environment. The continued resiliency of our business model and the strength of our execution drove strong overall profitability. During the quarter, we made significant progress integrating our strategy-led acquisitions to drive long-term profitable growth and secure meaningful new business wins than the global structural themes of sustainability, connectivity, and safety. I want to thank our global teams for their persistent commitment and execution to serve our customers. Moving on to slide five, as announced in February, we continue to invest for growth with our acquisition of Western Automation Research and Development Limited, a designer and manufacturer of electrical shock protection devices with a heavy focus on electrification. This acquisition accelerates our growth in e-mobility off-board charging infrastructure, particularly in Europe with its strong OEM relationships. and further expands our capabilities and diversification into higher growth industrial markets like industrial safety and renewables. The integration is underway, and we look forward to leveraging our combined capabilities to drive growth consistent with our five-year growth strategy shown on slide six. Before we get into business design wins, I would like to start with the customer and market dynamics we are seeing. Starting with our channel partners, as expected, we continue to see electronics distributors drive the reduction of their inventory levels during the quarter. We expect this inventory reduction will continue into the third quarter at current POS levels, which remain stable. Our electronics book-to-bill continues to run below 1, largely due to our reduced lead times. Our industrial distribution partners continue to hold inventory within normal targeted ranges. We have a healthy industrial backlog for the second quarter, and in-market demand remains relatively consistent with what we said 90 days ago. We continue to see soft demand in consumer-facing and personal electronics in markets, but in-market demand remains strong across high-power applications like renewables, industrial automation and safety, medical, power supplies, and electrification of vehicles and vehicle charging infrastructure. Across transportation and markets, we saw continued inventory unwind at Tier 1s and OEMs and at distributors for commercial vehicle applications. In our passenger vehicle markets, we saw solid content outgrowth across our product portfolio during the quarter, and we continue to expect long-term double-digit content outgrowth based on significant design wins in electrification and electronification. across commercial vehicle markets, we are positioned for long-term growth with the ongoing electrification, electronification in material handling, agriculture and construction equipment, and heavy-duty truck and bus. I am particularly proud of our strong first quarter performance as we successfully navigate this period of inventory rebalances and varying in-market trends across our businesses. Our global execution continues to deliver strong financial results and company margins consistent with our long-term targets. MENA will provide additional color on our financial performance and outlook. Now let's move on to business design wins during the first quarter. The convergence of sustainability, connectivity, and safety is propelling meaningful opportunities across the industrial, transportation, and electronic end markets we serve. Our diversified technologies and capabilities play a significant role in the advancement of these themes, which is driving unprecedented demand for our innovative and reliable solutions. Our industry awards received this quarter recognize us as a top supplier of best-in-class innovative solutions, driven by our unwavering commitment to customers. We continue to capitalize on the design-rich environment which will drive our long-term growth. Within industrial end markets, on slide seven, we continue to play a critical role enabling high-power applications related to sustainability and safety. The diversity of our business wins highlights our ability to globally serve customers. In renewables, the strength of our product offering won a significant business for energy storage systems. Within industrial safety, and power supplies for manufacturing equipment, our application expertise captured business wins. For industrial automation, our solutions, including those from our C&K switches acquisition, secured business based on product features. In commercial HVAC, we won business with our deep relationships and broad portfolio. Our expanding product content and the rate of new business wins continues to grow with leading customers based on our capabilities and intensifying focus on enabling applications around sustainability and safety. Turning to our transportation end markets on slide eight, our investments for growth are extending our global leadership position within customers. Our joint collaboration focus on sustainability, connectivity, and safety drove significant new business. In passenger vehicles, we continue to grow with major OEMs based on our early engagement, technical support, and breadth of high voltage products. We won business with the ongoing electrification of platforms and battery management systems and onboard chargers. With an expanded focus towards sensors within electrification applications, we also secured significant new business in power management. Within electronification, We captured business in telematics and comfort and convenience applications. We also continued to expand our business in traditional low voltage applications based on our proprietary technologies and superior designs. Our design wins and pipeline of business opportunities support the continuation of long term double digit content outgrowth. In electrified commercial vehicles, we leveraged our expanded capabilities from the carling and embed tech acquisitions to win global business with major OEMs. We won new business in delivery vehicles, trucks, and two wheelers for battery management systems, power distribution, and body control modules. In rail traction for trains, we won business in high voltage power converters. In electronification of commercial vehicles, We won business in delivery fleet vehicles within GPS trackers and in construction equipment for digital switching keypads. In broader commercial vehicle markets, we increased our product content in heavy-duty trucks and material handling based on our global support and long-term quality. For off-board charging infrastructure, our engineering capabilities and differentiated range of products, such as our power semiconductors, electronic components, and fuses secured significant business. We look forward to accelerating our long-term growth and off-board charging applications with our comprehensive offerings expanded further with our newly acquired Western Automation products. We are confident our investments for growth within transportation applications will strengthen our market leadership. Moving on to slide nine, sustainability and connectivity, and safety are drivers for growth in the electronics end markets. With the ongoing push towards efficiencies, our responsiveness, global reach, and product features want us to business in water meters and LED lighting. As it relates to greater connectivity requirements, our technical support and broad portfolio, including products from the addition of C&K switches, want us business and communications infrastructure home technologies, and power supplies for electronic devices. Our products are vital to safety and protection of human life as we secured business within critical life-saving medical devices. The pipeline of business opportunities is robust. We are extremely well positioned to expand our electronics content across a wide range of applications focused on sustainability, connectivity, and safety. Our new business wins represent a very diverse range of end markets, applications, and geographies. As we engage with our customers' engineering teams, our collaborations are accelerating next-generation product development and design-in activities. We fully expect the organic growth from new business activities, coupled with our acquisitions, will enhance and sustain our long-term growth. I will now turn the call over to Meenal to provide additional color on our financial performance and outlook.