Ecolab (ECL)

Mike Monahan SVP, External Relations
Doug Baker Chairman and CEO
Dan Schmechel CFO
John McNulty BMO capital Markets
Vincent Andrews Morgan Stanley
Manav Patnaik Barclays
Gary Bisbee Bank of America Merrill Lynch
David Begleiter Deutsche Bank
John Roberts UBS
Dan Rizzo Jefferies
Christopher Parkinson Credit Suisse
Rosemarie Morbelli G. Research
Mike Harrison Seaport Global Securities
Eric Petrie Citigroup
Andrew Wittmann Robert W Baird
Call transcript
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Greetings, and welcome to the Ecolab's Third Quarter 2019 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce Mike Monahan, Senior Vice President, External Relations. Mr. begin. now may you Monahan,

Mike Monahan

discussion Thank quarter's you. conference Ecolab's Ecolab's quarter available website the CFO. welcome and our Ecolab's along earnings on release and everyone With me our and and A our call. Schmechel, Baker, referencing and to our today results, CEO; with the third slides Dan Hello ecolab.com/investor. of results is Chairman are at Doug outlook

could and to materials. results discussed moment are cause stating under those and read the most Factors associated are actual section in estimates Factors that XX-K statements include in materials, teleconference our differ could from actual materially forward-looking Risk These recent a differ posted cautionary that these results of this take our to Form the and projected. performance. in materials supplemental Please future statements,

diluted We per the earnings share information also to refer the release. you supplemental in

results, innovation per and business productivity the with of new efficiency actions earnings XX% gains a third sales, quarter increase. pricing, third yielded quarter's product the adjusted and along and the cost diluted overview brief share improvements Starting with led

sales steady to X% and than the some highlights currency as the markets. decline moderately and in as offset press sales in shows gains on modest release, and adjusted Other industrial a FX quarter segments our institutional acquisition and softer Moving discussed from increased more energy

income continues energy we by a to share $X.XX growth operating to was translation of another per continue consuming to Energy Currency our gains XXX in completed to increased upstream earnings growth. unfavorable increased business, a EPS currency and adjusted digit margins by was spin-off the led double be $X.XX, share Income fixed double steady Adjusted the Adjusted segments. Progress basis quarter. Industrial the improvement. of per in points, expect mid-XXXX. their spin-off representing on XX% quarter digit an

re sales costs begin development prioritize Looking has enabled rebuilding ahead, fourth primary sales to product team's delivered our us environment as as objective. the our momentum moderated the will new in we quarter business

wins by always, best the and products, As our costs and sales results we service of proposition will innovative operating total our on customers. our for lowest focusing business new expertise, and drive value

also will cost and productivity efficiencies. continue We driving

now we add insights investments offset to efficiency our look to product and full range, are XX% sales our for to and new the their well diluted to than and effectiveness, our $X.XX to price We adjusted the them We actionable operations, business digital improve forecast benefits of rise for as market more the developing impact narrowed moderated look for to force with customers and enhance cost investments. and gains year per $X.XX earnings increases XXXX. delivered differentiation. share Our XX% volume cost increase

Fourth earnings are Currency $X.XX share X% currencies cost range $X.XX we XXXX. earnings share offset translation per fourth with yield deteriorated to In summary, and share adjusted to XX% delivered now than unfavorable in an adjusted expected be more XXXX per to and of per to product the in in expected earnings be good $X.XX along actions to is quarter momentum unfavorable $X.XX to costs and efficiency expect XX% growth. quarter exchange, moderated XX%.

to differentiation make we future. of the growth in investments, continue areas for investments develop innovation and and we including product year digital right As key this expect to superior

with Baker Doug here's now, some comments. And

Doug Baker

Thanks Mike.

while into this the we areas momentum I'd building quarter, moving the is some the as into there importantly on There's year quarter. quarter likes XXXX. are that very lot good this say quarter I'll So, offer in we third we're fourth this news addressing. The head as and in in a a good we're leave to my position take successfully,

XX% So, certainly growth. EPF the will adjusted positive in QX

supply our roll over XXX% flow up year-to-date very have of out is cash North a in QX with XX%. We inventories we pulled conversion SAP rate chain cash strong reduce America, as flow

Mike margin our OI strong helping basis reference. XXX continued also the points drive pricing We improvement

well Our into has managing from team and SAP a while the They North all really the the the rollout, business is improvements. in chain performance moved spin executed upstream board. American commercial supply also this drive they're across which continued arena of improving they're They're managing also to doing business.

pricing growth materials believe and talked some him the and something moved team priority as only from sales to is our smart focus, shifted do, I priority. field number have and now always primary. We've have meaning to we So, our also as priority we and we've growth thing pricing, has asked what the stabilized to one softened. have that we team market it's as call right focus growth That's one number to but growth raw you

this over trajectory leading up QX, back up QX, our to like of in QX. So, We growth state, year-on-year to what in XX% we'd would see. flat the need natural is XX% really their strong Net team was I indicators. results this XX% call shift seeing continue virtually that we're accelerating. roughly It and was year-on-year in all in moves to business

At pricing customer leading net time was throughout new declining the on not X%; importantly, very efforts in continued the so has trends. deliver upstream same to are and as which pricing while team retention up has to our QX year retention our well, business, we're the excluding our accelerating improved

our priorities, very about feel our I plan Finally, execution. and the good

we driving also So, also investment upstream needed job on spin. like we've I the SAP, driving are starting like we advantage and sustained we've while as to continuing cost, digital, got like development discussed, like great business; mentioned those securing the and to critical people pricing. results see for got secure on to the We're successfully pricing cost as a shifted new we've remain early,

So now, let Q&A back me open turn session. will to Mike, who the it up

Mike Monahan

you That the begin please concludes our would period. question-and-answer formal Operator, remarks.


Yes, thank you.

Markets. be conducting [Operator comes BMO question-and-answer of We And with instructions] first question line from now session. McNulty our will a the John capital

John McNulty

price about I queue. we I new that versus working means business quickly can the volumes of how development what how around get this guess on you we pricing well? thinking guess start shift kind the to to front And the the really mix moving as to for With reprioritization of look of I guess, regard of volumes? as XXXX be also, should sort

Doug Baker

Yes, in a a it's and usually be say in couple industrial, quarter start by would significant shorter I seeing different half. a business. lag there's little a lag and call up securing that a you when business Institutional, it it new quarter show can the bit P&L. between

to there's trend what I little up in for would business accelerating takes So, and growth a a new always a difference. trends show the time call make

think to expect good would one pricing. historically I We have

to Next year very the with carry good momentum. we're enter going year, in

about are We simple a just late in I who as were be and pricing. with on sounds. We discussion going be continue Sales we it like this price will It's contentious to customers -- they're honestly, pricing. teams doing to environment. trying it's just they mean, getting It's hate who as to us.

motivated economically, where now of difference a as hard sales raw very know is bell a it's get started broadly can to We smart the so, that, excited we thing you've and consequence volume. they is year and making get to to and on around They material this make got given ago little And a the teams over markets situation a on always call. pricing. rang

you year, an few going throughout change. see for but see we'll what you'll volume think I trend take a quarters increasing the material to is So,

John McNulty

the maybe means up? of can then what Industrial question And of and growth condition picking that you I actually macro quick to some shared that relatively terms just overall looked that in the seeing may looks some the have the on speak of gain like been it guess you the and segment considering a drop. robust markets you're end back and,

Doug Baker

is factors. think of this fared still it's mean, probably shows is number where I industrial I up from certainly areas. several to some pretty softening we well. not and our and would instance agree, think it There the eight in Yes, industrial a down but strong I looking for we it places it's markets across like went five areas. I an really see it I quite think those business are water two the went board stopping it's points mean,

plants, whereas there softening as a really of which chemical we are is business, lot would commercial life that buildings, markets is impacted there those F&B also auto well. think and I around paper example of the noise and an steel, some So say sciences see we

song right update it, but have and obviously business good not very what it But with we'll see we worse wherein a we it clip our I conditions that this market. XXX% thing view think we business that I efforts think said, new is this dramatically in a can forecast, we not of but that's maybe then of if that mean now. lot to a gets our will overcome ultimately grow if still


proceed line The Please next Morgan your with Vincent question. coming Andrews with is question of the from Stanley.

Vincent Andrews

strip you you then if you us us we think kind to could help Maybe, you happier walk businesses done? through margin out as more just energy where there's the performance were and work and just the be the where exited, unpack can if you of low segments volume

Doug Baker

had where it have a But in Energy would growth. meaning was down happy I lost we the And year volume with unpack paper include We total. take -- probably would this our it, chase. thought a in this don't if aggressive I've go that we we quarter targets ever away, I point your was I you and segment,

be will but up to that's we in be, this really not emphasis. we a need shift why without point, So which of sort those, where is

all other share we going markets. even out good good adding our got in have gained trends have of We strategy when go every very we've them, pricing We've share. a against losses and we're I but on wins carry-in. know to really moving to competitors, softening We you've would have to point of you on major one get got against more track things. and major gain share

Vincent Andrews

is specific as just could, and I pricing putting just are place, it new you're basic digital new initiatives blocking into ERP it driven? tackling? that business it to that pivot, or Or in the technology, is there If is a system product-specific follow-up

Doug Baker

if Well, critical to that's benefit means business. of customers, new the good to bring to success new have we all we sales additional team end the existing the use one absolutely innovation equipping and primary, and in will, as i.e. our you to

in QSR digital the new it seeing strong it was in starting we've number the to retail water where led we Institutional one bear of in and well a had accounts, of certainly, very So well. we're We're there side, as fruit. seeing early adopters really around food that seen as and the we've in are efforts efforts

there we're achieve, last drive. to what has four kind been that trying months clear established trying momentum new the we're of year, with target But what for said, to the of

our Beck, COO sales tracked, they're that help also, clearly these the confident, teams it's think momentum. volume initiative by well love will initiatives, and clearly quite gain I pricing it's us it momentum monitored Christophe we're as over as led all


Next Mr. coming Bank proceed Lynch. Please question Merrill your with your line questions. from of the is Bisbee, Gary is open of line for with America questions. Bisbee

with will Moving question on, from our of be the Barclays. next line Manav coming Patnaik

Manav Patnaik

My up the follow was the between the first to a -- quickly I just bit today on in decision What just backdrop and also was may little be why color the shift. the today? it changed or more quarter, any just just made on just guess weakness question Industrial is side it is pricing that -- prior

Doug Baker

takes It was it wasn't little shift, several for it. as to This moving ago. to made like natural mean months enact got you made today. a this And it time really I us. occurrence start -- we Well, is obviously

abnormal natural or would sort it's and call, back pricing where pricing, natural later, state bent I get of to state is growth call to so it versus what our over -- then a growth. was a Sooner

a shifts were in that raws And year-on-year you it see than situation we to when we QX in start slightly fact, a was takes everything And this net as bearing And had stabilizing for forecast, time terms that, fruit. to daylight we of at look out total the a true. a will, year started in cheaper little market, had saw certainly, they little were fact, rise, you we so in condition we if ago these it year in we know, what's i.e.

be behind it. So a not in actions flight going that no to to team. that completed the all you are by is ahead curve got little sales be bit are the There doubt the of pricing

front. I'd point when to strong had we was business new that in growth, continue monitor still out even We that pricing

So we'll continue to have even front. good growth when effort in pricing is

Manav Patnaik

that thoughts comments just your you need on should because into some XX X XX%. the just then growth is the on I to new acceleration broadly or all net really the And I XX, fourth next quarter guess think we to business, interpret how in said you from year

sounds XX% a So stand-out there? that

Doug Baker

of P&L. relatively And small right not the terms number in Yes. it's a whole

mean million got a add a I you at loses in X% in you've if business give and going business. grow if to So, a you're to you it X% if simplistic attrition. I Then very wanted example new year want XX% a $XXX to need to

Somehow go let's would through like continue if grow to doing we it the corporate some this, a you only gains Kay, be comes roughly new as XX% have sell at the pretend in net to you X%. it's year, rate, XX%, that. you well to grow that that start accounts, each continue math like accounts, want corporate only got from to businesses really

and good that have things around measure we I John rate, show-up. our numbers you we look us. they're we And for more closely, an so as wiggle not like asked doesn't, we forward room the in look because to I this we very had XX% that's how think like that this be some question. the immediate if are so It will, and it's mentioned, types so indicators at But at of those the

a our it announced, that So we four six that's it counting contract, itself think time same realize to will to the fully are volume, take P&L, if new even for we and important. as to day four take fully three losses, day, that see it's new us we to the to though that and count into loss install months it land, we at but months business may may

this really corporate is our in whole of so a of our number And wins losses, and really measure principally large accounts.


of of Lynch. Gary The line next with America Bisbee the Bank question comes from Merrill

Gary Bisbee


bit see areas the time, of more at revenue. one F&B, number if Let's There were works too. comps this a paper I the actually is this being tougher. a cut guess, where Doug, quite

walked talked can normalize that of because some about to or like sequential Life of timing like, underlying how weaker You away business at change from trajectory of the know items? that recently, in much macro other Sciences. you Institutional sort is factors low-margin We deceleration at relative the conditions those actual

Doug Baker

call a some on this, mean X think when to momentum. to And Yes, We like of X point if point if normalize deceleration. and there's like Industrial, will our already we sort shift pricing gaining I were I we size it's X would business, we starting are you back results, point sales in apparent on we're think to I you base. we new thing, is it just a I going get you mean, end grow kind I we why top of gear that's know from going get higher this mean to market business. the we of this to know up, will, new see that still

if market good conditions to this Now performing. or the a but are we're think can, promise going us still to we Nobody's less market we We today. able nor is cover in be any like to expected we they aren't to fashion will relatively us for continue that perform to that the ever more condition. remain

Gary Bisbee

a quick out pricing, start follow-up still And enter the just mean been or over it X% bigger X% expect said then having long-term reasonable you've of to us. to get lapping you is the we solid more like to comps the sort anyway What's as help pricing, or you about move next that's on price to but difficult or think you increases gotten. year? X% average the obviously, I because so pretty the XXXX

Doug Baker

quarter be through I above rate expect slow calling that significantly X% Upstream not mentioned, over right, little when up, but the and you a current almost Yes, strip at which about going it's in as normalized the rate, would we averages we X.X%. year, we it's rate is out terminal the fourth it really going I the that It's to be to have. our will say,

in think I base don't still inflation we in really forecast our have we're material year pricing. next benefit a where So raw from position to


with Please comes with of question Bank. line questions. from your Begleiter proceed next David Deutsche the The

David Begleiter

concern Thank may Doug, institutional -- discuss from competitor? the your dynamics the new can price aggressive business competitive more you. response in that any be on might elicit development large and U.S. view some you

Doug Baker

anywhere, their haven't haven't, Yes, than seen would more at losses really say, look against huge X David, it's I we change I times behavior competitor, our Institutional wins as in main we wins and our F&B losses.

feet to I street honestly technology think our in and I ability on think and to the up. continues great advantage, deliver show so value And

we of we and getting I'm dimes see very away just it. that If so walk look good mean, large situation, with I seeing -- don't not and the margin kind numbers at We're accounts. nickels have have, medium we we're the it. small, not retention we ex So retention,

year, Our very the that strong in retention actually had. improved has the given which pricing Industrial they've throughout performance is terrific

that's we So what know.

David Begleiter

And good. stock more on due how M&A to is in M&A the just that is bought pipeline no buybacks, active today? back quarter, you Doug, Very and pipeline

Doug Baker

we've I've going obviously a smaller number of we're Yes, call I'd pipeline a middle what deals. mentioned large and this got after to

so we reasonable a any shareholders get to but improve I need pretty got that have they're return sure in, that folks X going be three, your history longer not be them ability but and larger there they're of over we'd the is companies our X, for to price times -- you disciplined. period and we we're with think to pretty, to Typically interested also time. make

to be, mean but better and there just I environment. is it's upside it M&A what tell a a going I will coming, would say be I never recession an really can't recession, want there if is a year I you


the Please question. with proceed of UBS. is line from with question John your Roberts Next

John Roberts

business should business? or exited, that never you business that Ecolab businesses the then SBU, Doug, been eroded then got if customers thanks. you you've the that for In have business was for can and characterize the that that the was it was that are Institutional And exiting? in in, in us

Doug Baker

Yes. margin the that The offers a decreases ever us characterize were consider dramatic on as for table we lower would value what were I customers in the would deals. No, before favorable. time, were we long that on equation business was had those we the meeting put business for

bids. it if it And those like so be down we going good, was to met while was upside

We of a a business of price made I there we as so, number And that. different is the been back. was It years. mentioned we all business a we've this happened. business say secured choice. and and kind to that time, I secure moves cases, really chose almost through over We've much Institutional offered many last. region. as in mean, first through try And than being the at isn't -- we I the do we sure the had not this would to F&B to course in re-secured can't has of we've This And a continue of customers wish well. for one. before, went I would years, one be in that it think wave that I'm of have of by I

to maintain got we've So price discipline.

just And selling quite cost any understand the for doing not of the cost cash business a -- advantage we we just I have do or customers to our monster this disadvantage, we sense doesn't believe cost Going -- I think us. well. make loss

John Roberts

are put margins you the currently? the the energy the will overall segment? Industrial about business downstream same the industrial post-spin, then segment as And And into

Doug Baker

Industrial Yes, up the in downstream will end segment.

margins fact, higher. In their are


with your of from Laurence Please Jefferies. next proceed questions. comes with the question The Alexander line

Dan Rizzo

the be policy make you I environment? a oil you spike were is for change shift are would Hi mean the the kind So would shift terms threshold input next it there I that guys, How in with or for Rizzo factors on this to of with your if how external growth a to about cost of certain and Laurence. things do mean you? pricing Dan again. think in year, is

Doug Baker

be absolutely, I it you would re-prioritize a well to scenario smart Yes, pricing had draw input a mean where again, can growth.

we could but that obviously there. it anticipating pivot aren't should We happen, quickly environment


Parkinson coming Credit question. your with Next question proceed Please of from is Suisse. the Christopher with line

Christopher Parkinson

F&B across these enterprise intermediate us Industrial And other pretty elimination to you substrates. selling you. among an just to Can opportunities results could update F&B? continue enterprise long-term they there Your on within pest glaring in on well initiatives where to XXXX? few give go comparable any stand? do selling water Where just in a are Thank other

Doug Baker

penetration really And Well, yes, successfully. partnering probably -- it water that not in is at would F&B where the we yet There a legs lot many I why concept, haven't enterprise where penetrated I combined small say don't within water there but have are of full all. we characterize it's as are and customers partnership. honestly, and because there of may just left very others

the has think With team a look sciences even and I acute you et the there say hotel water is, at sure to Institutional, But to create that go even the plenty make to would boundaries really external life I sterile water with that still room the is said, and done great So hospital upside. they're there. in with left continues up they of healthcare job. for significant building particularly if a care pharma cetera. there segment and segment, With is match

that would new capability it, customers. opportunities capabilities we to The to these go impact digital number say to So the of I as we're data solutions a initiatives forward. what and marry there for enhance create outsized getting our are and just

Christopher Parkinson

it. Got

months the healthcare XXXX walk two You've to also for our just Can some XX in with three more programs key internationally. quickly the drivers lot us -- the strategy both months, service U.S. evolution? Thank abroad XX the to in stuff just over products growth and given you. last including and you through

Doug Baker

them forward. strategies driving to already the of to the that's continue call programs create smartest would We and I work long-term and to to know They program, commoditized one, additional continue success. continues digital number what selling say, initiatives with have some moving the underway. are that wrap capability team would I pull look, segments Yes, one

had be A discussed the and we Investor continue as device this really an and OEM our initiatives sides both be two can other quite marrying gives sticky that and Solutions. med-tech companies' at of these Conference is we push. lot as joint that Those capability to we well. would capabilities creating that is big solutions other, The advantage

we push on want like internationally and geographic continue will, more moves business We build China ground-up to using continue you Ecolab don't a out where Ecolab if Anios et full build, traditional with approach. Australia, outward service to technology and their to countries we cetera healthcare


comes Our question. Morbelli the from G. next of with line Rosemarie question Research. Please your proceed with

Rosemarie Morbelli

looking catch business an business Doug, of downstream and the have do you of weather? energy, year to until maintenance. the mentioned also that fourth or And can at give a you wait you you of start-up because of is spring timing the the the of timing quarter then, new next downstream on Could that up estimate us in impact growth?

Doug Baker

we Yes, I discussed. the downstream in the issues business mean think the no, quarter, will that because timing of be fourth we much better

the rebuild very businesses. margins inflation. is performance. mid-single-digits securing had that of pricing It's downstream would well have they well I all have as been other some them to say, result a over of significant pricing. done in enhancement margin, price because as type much material helped a good as So job drive raw They not than different and clearly

share and gains of to on to shift got and make but plenty are they've that. they start also a driving growth in and growth pricing that they have do get as first, And sure opportunities they so,

Rosemarie Morbelli

pricing overall stand? may quickly how transaction, touch have do where could business you on because transaction could much on of in Holchem And if then you strategy? UK, And the the you lost the if you us your update then

Doug Baker

with been Unfortunately, it in announced, the Well, the think have mean asymmetrical. disagreement the power we I this authorities. is I a Holchem, anti-trust disagreement has

same, positive. available the But not plan us. it channels to to that legal challenge clearly, we Just the a it's through are

And that the let have move through and courts. we just so, to

over know which know year and because In customers around there few sure pricing. I retention, now earlier, measure we is we don’t which a when is terms what of we've just conversation the which two of is in old very material evidence Institutional, but the our a lost carefully story cited of by well evidence in the those -- we I don't mean from aside got customers news, I'm we had -- -- best of the not I we business. is call terms

better is and corporately throughout the Industrial. retention improved it's in Our year

pricing has base. the had our see really don't effect an on adverse customer we So


Our Global is with Securities. Mike Seaport the from question. next proceed line with of question your Harrison Please

Mike Harrison

Was mentioned wondering softening worsening? you trending autos question and into QX the some steel. is about in of Can for about time. during business, little third the were bit been that water of markets heart guess were you And autos my a and quarter some they those how talk I kind weak have the

they've been some some that looked down they're the it because is So under autos in haven't why weaker earlier pressure for that in guess activity shut happened year, time? QX? And I why didn't --

Doug Baker

you scenario. Yes publicized autos as well I think know

because situation autos weakened that see It quarter mean we QX. weak strike might QX that So was I the strike a off. we think any turns we go through. expect don't and aside to means have as in GM. I I mean where a you But them customer by from and would in around throughout on remain specific

steel grow the We of steel, area. fourth got But as is in because quarter. as In business grow. to we of terms to the But more it down. expect mean in of I consequence, as mean I new a business message part overall, it secured we mixed goes. that one in business and that other as hopeless we that continues don't autos at would look Industrial

Mike Harrison

looking on the protein an then market. for business, F&B a update on the And just question

specifically wondering quarter, that's You on African was the had moderately that what fever seeing on mentioned that related comment protein to that, but market impact the during and grew you if markets? can swine you're

Doug Baker

a I in impact protein would exposure don't and going chicken. us, beef be Yes, on material our of most have that's to think given

we've to continues of seen would more So the protein business same. low We the single-digits. grow. It's expect


is your Please with Juvekar question next proceed from of line with question. PJ Citi. The the

Eric Petrie

volume and your Eric the mix trends? quarter, is underlying do PJ. how you this Doug, afternoon, Petrie that versus compares industry was Good flat in on think for

Doug Baker

heavily mentioned influenced off we was that's right, as by also paper. which Well, Energy, and earlier considerably

declines I those trend. think industry very line even with much were in

on argue are -- many of of and think think our mean market if our feel say I would or I at I we going we we gain held think but those in think then rate in need say, we're environment look might even wins I to You the net what a on to gaining if industries to walk want we losses -- the now. in actually got share, through, in sort at lot balance, you the total, markets. I but share how not look in we're is the you right now we I've net I would that markets, And

Eric Petrie

your been that's temperature you with product healthcare, innovative team get the In management. higher? core and enough think dashboards, digital to predictive launches analytics, including has fluid top-line growth Do

Doug Baker

the low mid-single Well, right we're to digits, bouncing around now.

I to going range. think while of it's take move that to out a us

to But those you enable do mean will, to it. talked as the we need in the to evolving things us portfolio I much So Investor we going more I grow. think to Conference, if are continue

commoditized taking Some growth that of things do category. been in the them that we have and by putting

than a we And stuff the faster just go. in time, grows category shift growth over not seeing and start as some, it's the stuff the we natural


Robert questions. proceed with Andrew Your Wittmann comes Please with Baird. W the from next line question your of

Andrew Wittmann

you're over about questions mean and SG&A wanted XXXX? guidance little for into the that the in bit head in that, this kind around we fourth guiding here I the then in of profile. sequentially that if dig on is there XX% of each from year, more XX% the look of makes like falling fourth I quarter quarter. a unusually we thinking to as course into XX%, XX% or is of that the been quarter Yes, look SG&A has guess it the kind in top-line, a way anything margin margin the and at about the there's XX%, lot I quarter as anything been the be or to quarter, that you low unusual

Doug Baker

more artificially look We would of there is low. as big front effectively to in capabilities certainly, I the productivity business mean with us news time, they on more need those manage And that we no Yes, we are on enable tools believe i.e., it to our there always there are we makes them successfully. is to work all in equip tools, productivity still working say leverage we flight. in new teams routinely.

the And ratio. continue to way it of so way? work, at I like sense evidenced SG&A and enable a new makes not i.e adopt truly good we but in got means that that we're customers does the to to doing end which does And technology, done decline we've do any serve in as that we've good is us both right a can productivity think job the do by it it people our journey, continued retention, by believe

Andrew Wittmann

which In looking gross I that. guess similar SG&A the some think efficiency head a into you're and could besides I but there other many, are see wondering puts for raw Obviously, of to the I thanks Great, got you of and place, quarters, leverage largely story gross side. which performance the has were from based, factors that takes margin see. for that margin have factor the you're there's out just other starting is that couple Are pricing, go into materials what been bigger to complex that would the great material my as gross the Obviously be, XXXX? there margin in your at many Doug come of your factors are side? lot raw guess initiatives now. years that this. on you've takes question I -- was into puts that the last follow-up gross on margin cost

Doug Baker

plants work primarily. is think got a I the would mean, by they roll-out Ecolab business, really Yes, of lot more a the number. I there on call was Energy what I what particularly we optimizing formulation one, impacted we that what make had. would where were and we SAP no, I call in legacy is That on

consequence liberated, they they were weren't as So frozen. a

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our floor reached Mike back comments. you. will We've session. the the question-and-answer to closing for Thank I end Monahan of turn

Mike Monahan

This third be website. quarter our call discussion for wishes slides participation rest the and the best replay Thank for on of our time Thank conference you associated you. day. conference That wraps call. our up and will and for available the your


a Ladies and teleconference. today’s lines And time gentlemen, This may this at your you day. participation. and now your does wonderful conclude disconnect you have thank for