Atkore Inc.ATKRNYSE
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Operator: Good morning. My name is Carly, and I will be your conference operator today. At this time, I would like to welcome everyone to Atkore's First Quarter Fiscal Year 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. Thank you. I would now like to turn the conference over to your host, Matt Kline, Vice President of Treasury and Investor Relations. You may begin.
Matthew Kline: Thank you, and good morning, everyone. I'm joined today by Bill Waltz, President and CEO; and John Deitzer, Chief Financial Officer; and John Pregenzer, Chief Operating Officer and President of Electrical. We will take questions at the conclusion of the call. I would like to remind everyone that during this call, we may make projections or forward-looking statements regarding future events or financial performance of the company. Such statements involve risks and uncertainties such that actual results may differ materially. Please refer to our SEC filings and today's press release, which identify important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. In addition, any reference in our discussion today to EBITDA means adjusted EBITDA in any reference to EPS or adjusted EPS means adjusted diluted earnings per share. Adjusted EBITDA and adjusted diluted earnings per share are non-GAAP measures. Reconciliations of non-GAAP measures and a presentation of the most comparable GAAP measures are available in the appendix to today's presentation. With that, I'll turn it over to Bill.
William Waltz: Thanks, Matt, and good morning, everyone. Starting on Slide 3, we are pleased with our first quarter performance. We achieved net sales of $656 million and adjusted EBITDA of $69 million, both were above our outlook range. Our $0.83 of adjusted EPS was also above the top end of our outlook range. Organic volume increased 2% in the first quarter driven by strong performance in our Electrical segment. Our teams have been focused on improving manufacturing efficiency and controlling costs which has helped generate over $30 million of productivity savings year-over-year. We also continue to advance our strategic alternative process to evaluate opportunities to strengthen our business and maximize value for our shareholders. During the quarter, we completed the divestiture of our Tectron Mechanical Tube product line and manufacturing facility. The sale further enhances our focus on the electrical infrastructure portfolio and is aligned with our broader 80/20 initiative aimed at directing our manufacturing capacity to electrical end markets. And in the second fiscal quarter, we expect to complete the previously announced exit of three manufacturing facilities. We will continue to provide updates on our ongoing strategic alternative process as appropriate as we move forward. I also see some highlights release for fiscal year 2025 sustainability report, which we recently published. This report details our ongoing initiatives and accomplishments over 2025 goals. Looking ahead to the remainder of 2026, we are on track to deliver our FY '26 outlook that we presented in November. We expect for net sales to be in a range of $2.95 billion and $3.05 billion. Our net sales outlook adjust for approximately $40 million of annual sales related to our Tectron mechanical tube product line resulting from the divestiture. Our adjusted EBITDA between $340 million and $360 million remains unchanged. Adjusted EPS is expected to be in the range of $5.05 and $5.55. We remain focused on our core electrical infrastructure portfolio, which is supported by broader megatrends and where we see the most opportunity for growth. Our team is focused on continuous improvement initiatives in our plants and providing unmatched service and quality for our customers. By doing so, we are confident in our ability to drive sales volume and profitability. I'd like to take a moment to thank all of our employees for everything they do to support our key stakeholders. With that, I'll now turn the call over to John Deitzer to talk through the results from the quarter and provide more details on our outlook.
John Deitzer: Thank you, Bill, and good morning, everyone. Moving to our consolidated results on Slide 4. In the first quarter, we achieved net sales of $656 million and adjusted EBITDA of $69 million. Adjusted EPS was $0.83 per share compared to $1.63 in the prior year. Our tax rate in the first quarter was 3%, a decrease from 21% in the prior year. The first quarter tax rate reflects a onetime discrete benefit associated with tax planning related to a foreign operation. Turning to Slide 5 and our consolidated bridges. Organic volumes were up 2% compared to the first quarter of fiscal '25. Our average selling prices declined 3% during the quarter, most of which came from our PVC conduit products, which were partially offset by increased average selling prices for our steel conduit products. Moving to Slide 6. Our 2% volume increase during the first quarter was driven primarily from our metal electrical conduit and our plastic pipe conduit product categories. Both product categories benefited from healthy nonresidential end market demand. Our metal framing, cable management and construction service businesses saw lower volume compared to the prior year, primarily due to the timing of certain project-based work. We expect growth from these businesses throughout the duration of the year. Our mechanical tube business, which includes our solar-related products is also expected to grow throughout the year due to the expected timing of large utility-scale solar projects. As we previously communicated, we are shifting certain available capacity from our existing nonsolar mechanical products to our electrical conduit products as part of our 80/20 initiative. We would expect that to continue throughout the year to help support electrical end market demand. Overall, we continue to expect mid-single-digit volume growth for the full year. Turning to Slide 7. Net sales increased year-over-year in our Electrical segment, driven by higher volume growth, offset by lower selling prices. Adjusted EBITDA margins compressed in our Electrical segment due to higher material costs and lower average selling prices. Net sales in our S&I segment were lower compared to the previous year, primarily due to lower volume. Adjusted EBITDA and adjusted EBITDA margins both increased year-over-year due to increased productivity. As Bill mentioned earlier, Atkore recognized over $30 million of year-over-year productivity, most of which was generated from our S&I segment. Turning to Slide 8. We ended the quarter in a favorable cash position despite a year-over-year decline in our operating cash flow. Keep in mind that our Q4 FY '25 operating cash flow was our strongest quarter, generating approximately $200 million. Our first quarter in FY '26 ended before we typically receive large collections from our accounts receivables. Those cash collections fell into the first part of our fiscal Q2. Our results included approximately $18 million in cash proceeds recognized from our Tectron tube divestiture. These proceeds represent a portion of the divestiture proceeds. We anticipate receiving an additional $7 million in the second quarter from the sale of our real estate where the products were manufactured. Our balance sheet remains in a strong position with no debt maturity repayments required until 2030. Moving to Slide 9. We continue to expect volume growth to be mid-single digits for the full year. Our volume growth expectations are a combination of core construction growth as well as contributions from certain growth initiatives such as solar and global construction services. The recent Dodge Momentum Index forecast continue to support growth in the core nonresidential end markets. As a reminder, we are no longer providing quarterly guidance. Rather, we will continue to update our full year expectations. In November, we communicated that our full year expectations are weighted more toward the back half of the year. We still believe this to be true. With that said, we expect our second quarter to be similar to but slightly better than our first quarter results from an adjusted EBITDA perspective. For the full year, we expect net sales to be in the range of $2.95 billion to $3.05 billion and adjusted EBITDA in the range of $340 million to $360 million and adjusted EPS in the range of $5.05 and $5.55. With that, I'll turn it to John Pregenzer to give an update on our end markets and our long-term strategic focus.
John Pregenzer: Thanks, John. Turning to Slide 10. Last year, we announced our intention to consolidate 3 manufacturing facilities. This decision helps us to prioritize our portfolio for domestically manufactured electrical infrastructure products. These actions are part of our broader 80/20 initiative to serve our customers efficiently while also creating a more streamlined cost structure. We are on track to exit these facilities in our second fiscal quarter. As John mentioned, our expected volume growth in fiscal '26 is a combination of base market growth and contributions from certain key strategic investments. The Dodge Momentum Index continues to suggest favorable forward-looking indicators of growth. A recent Moody's ratings analysis suggests that $3 trillion of investment will flow into the data center market in the next 5 years to support the need for servers, computing equipment and new power capacity. Our portfolio of metal framing, cable management and the entirety of our conduit product line are well positioned to benefit from this growth. As the electrical industry plans to support these growth figures, available labor continues to be top of mind. The associated builders and contractors estimates that approximately 350,000 additional workers are needed to meet the demand for construction services in 2026, and that number grows to 450,000 in 2027. Atkore has a history of prioritizing labor-saving opportunities for installers through new product development. Our PVC junction boxes, 20-foot conduit and patented MC Glide armored cable are just a few examples of how Atkore has made construction installation more efficient. The electrical industry is a great place to be, and we are working to meet the market demand by executing our Atkore business system centered on strategy, people and process. With that, we'll turn it over to the operator to open the line for questions.
Operator: [Operator Instructions] Your first question comes from Andy Kaplowitz with Citigroup.
Andrew Kaplowitz: Can you give us a little more color on the core markets that you're seeing? I know you just talked about it, but it looks like core PVC and metal conduit markets in terms of volume accelerated a bit in Q1 versus what you saw in FY '25. So maybe you can talk about that. And then conversely, I know you've talked about construction services ramping up at some point. I mean there are a lot of mega projects out there, particularly in data centers, as you kind of cited. So when can we see that start to move?
William Waltz: Yes. Andy, I'll start here and then turn it over to you to Johns. Yes, you are correct -- and again, John Deitzer, something if we want to get the precise numbers. But PVC, we're seeing good growth with, steel conduit we're seeing good growth with so up in good markets overall. And then regarding data centers, it truly is just the timing of year-over-year in those projects. We are seeing, again, with our -- giving you precise numbers, we are seeing strong backlogs and commitments for orders and expansion opportunities. So we're bullish in this fiscal year and then even more so as we get into fiscal year '27 and so forth.
Andrew Kaplowitz: And Bill begs the -- sorry, did you want to say something else?
John Pregenzer: No, Andy, just a few more information on that is strong Dodge Momentum Index in the quarter. We could really see obviously being driven by data centers. Warehousing is strong. and education, health care, some other end markets, we're seeing some growth. Specifically to PVC, we have seen some increases from the border wall. So it's been one of the areas that's been driving some of the stronger PVC conduit demand.
Andrew Kaplowitz: That's very helpful color. And it begs the question. Obviously, it's early in the year, but you didn't raise your EBITDA and EPS despite pretty good Q1, especially given the good productivity. So is there anything incrementally you're concerned about? Or is it just really early in the year?
John Deitzer: Andy, I'll jump in here. I mean. Yes, go ahead, Bill.
William Waltz: Go ahead John.
John Deitzer: Yes. Andy, I think it's just -- we're -- first quarter, we're pleased with the results here. I think as we look forward, we still have a lot to do. So I can walk through some of the other dynamics here as we're seeing. But just I think the good first quarter and want to maintain where we're at. Bill, anything if you wanted to add?
William Waltz: I was going to do very much the same. It's like to sit here -- let's hit our numbers, grow. We had great productivity that we called out. So I mean, things are moving along at this stage. But before we get too far out ahead of ourselves, Andy, let's get another quarter before we even start talking about the second half of the year because there still is a reasonable pickup in Q3 and Q4. So it just seems like the wise thing to do at this stage.
Andrew Kaplowitz: Agreed. And then just one more quick one. An update, I think you talked about the competitive environment a little bit. You mentioned PVC kind of pricing is still down, but steel conduit up. I think you said import competition in PVC kind of remains. But sort of what are you seeing in the 2 major markets there, particularly from the foreign competition?
William Waltz: Yes. So specifically for foreign competition, and I'll start with PVC and go to steal. PVC continues -- the imports continue to come in. So maybe not surprised because, again, there's very few tariffs. It's the 10%. And as we walked through, it all depends. This is not new news on the -- what somebody claims is the value. So I don't think anything has dramatically changed there, but it's not like it's necessarily improved. But it's still probably -- again, we don't have precise numbers on the market size, but it's still probably less than 10% of the whole market. So -- but it's growing like our PVC business is also growing. Steel, I think there is moving more in our favor where, again, we had strong growth. And give or take, for the last 3 months, I want to say from a year-over-year perspective, it was down low to mid-single digits for imports. So while they're stepping back slightly, we're continuing to grow. And then I think in the prepared remarks, but if not, both our quarter-over-quarter -- excuse me, sequential quarters are up in price and also sequentially go up in margins and so forth. So moving definitely in the right direction with metal conduit.
Operator: Your next question comes from David Tarantino with KeyBanc Capital Markets.
David Tarantino: I appreciate there's an update specifically on the strategic review, but maybe could you give us some more color and an update on the cost saving effort, what you expect productivity to contribute following the nice start to this quarter and particularly around the exit of those 3 facilities that it's expected to be completed here soon.
William Waltz: Yes. So I'll walk through it and again color from the team here. But -- so for strategic alternatives, we're still being worked. So -- but again, as we've always said, the Board doesn't have a time frame. So I don't want to sit here and give any more handicap on things or time frame or so forth. But we're continuing to progress through different things. Obviously, we mentioned small things like the divestiture of Tectron. We're still moving forward with HDP probably at a faster pace than you imagine in the overall examination if we do consider Atkore as a whole corporation and so forth. So from that standpoint, moving forward, a phenomenal quarter with productivity. I expect this to be our best year probably for productivity. On the same hand, realistically, we're not going to have $30 million every quarter. But we started a good January, and it should be -- last year was a strong productivity, and this should be a good year of productivity. And then finally, to the 3 plant closures, I'll let John Pregenzer or John Deitzer add a little bit more color. But I think to what John Deitzer has mentioned in the past, it's $10 million, $12 million, and we think potentially more as we get things running. And I would say they're running the closures at a smooth and ready to on schedule complement to John Pregenzer or if he wants to add anything to that?
John Pregenzer: No, Dave, I think everything is going as planned, seeing favorable transfer of the manufacturing equipment and start-up, hiring of the people in the plants that are getting the additional capacity is going well. The training is going well. So we don't see any issues with executing all 3 of those actually on plan and on schedule.
John Deitzer: Great. And then just to add, David, just a little bit of color on the productivity dynamic throughout the year. We are very pleased, as Bill mentioned, around the first quarter's performance. And as John mentioned, we're really pleased with where we're going. We have a little bit of dynamics quarter-to-quarter this year, just meaning the second quarter, in particular, last year in Q2 was a pretty strong -- was the high watermark for us from an EBITDA perspective. And so the comp will have a little bit of a dynamic this year, Q2 year-over-year. That being said, though, we're really pleased with the overall plan for annual productivity this year and then think some of these initiatives will continue to benefit us as we move into '27. But in the second quarter, we're not likely to see the strength here that we saw in the first quarter largely due to the year-over-year comparison item. Hopefully, that helps in frame it a little bit the dynamics.
David Tarantino: Yes. That's helpful. And then nice to see the price declines on the top line narrow, but maybe to put a finer point on price cost, could you give us an update on what you have here embedded in the guide? It looks like much of the year-over-year headwind that was previously expected has kind of already occurred. So how should we be thinking about that previous unmitigated $50 million headwind now and the offsets to it?
John Deitzer: Got it, David. Yes, it's a good question. And the price versus cost headwind that we have this year is largely loaded here in the first half. You see the impact in the first quarter. We, again, think the second quarter year-over-year, we're going to have a price versus cost unfavorable. I don't want to start guiding price versus cost quarter-to-quarter, but we do anticipate the totality of the back half to be price versus cost positive here, might be very slightly, but that's potentially here as we're ramping. So it is very much loaded here in the first half. So we'll see how the dynamics play out throughout the year. But right now, to your point, very much a first half issue here that we're working through.
Operator: Your next question comes from Chris Moore with CJS Securities.
Christopher Moore: Yes. So terrific margins on S&I. Is that 16.2% is that sustainable moving forward? Or just kind of any thoughts there?
John Deitzer: Thanks, Chris. I mean, I feel like a little bit of a broken record. I've said this a few times. We anticipate that business to be more in the, let's call it, 12% to 14% adjusted EBITDA margin level. It does have some mix dynamics when we think about the growth in solar, et cetera. that might have a little bit of margin dynamic with it. But that team has done a very nice job of performing from a productivity perspective and has driven those margins higher. So I do anticipate some of the mix dynamics probably will level out a little bit. And I don't know if we're going to be able to continue exactly at the positive productivity level we had. We did have some items that were more discrete benefits here in the first quarter that helped push that elevated a little bit. So we'll probably see margin regression in the S&I segment here as we move throughout the year.
Christopher Moore: Got it. And from a cash flow perspective, you talked about Q1 timing, some of the issues there. Just maybe from a fiscal '26 perspective, can you talk a little bit further in terms of kind of overall thoughts and how we should be thinking about it?
John Deitzer: Yes, it's a great question. So as we move through the year, we do anticipate cash from ops to improve. The first quarter was a bit of a headwind, as we mentioned. But you have to go back and remember how strong of a cash flow quarter we had in the fourth quarter of fiscal '25. And so we had received multiple AR payments both back in July and then in September. And the way this quarter ended on December 26, we -- several large receivables we have fell into our fiscal January, but really occurred December 28 or 30 type of dynamic. As we look forward, we expect to be modestly here price cash from ops positive in the second quarter and then continue to ramp here in the third and fourth quarter from a cash flow perspective. You have seen -- we have modestly reduced our expectation on capital expenditures here this year. We're just really ensuring we're investing in the right projects and really dialing that in as well as we move through the year.
Christopher Moore: Got it. And maybe just last one for me. Obviously, backlog is not historically an important metric for you guys. But with some of the focus here on data center, et cetera, is it potentially becoming a little bit more important? And is that something that's building a little bit at this point in time?
William Waltz: Yes. I think, Chris, there are a couple of thoughts there. For the core business, it's shipping 5 days, 10 days and little backlog. For the data center business itself, global construction business, the question I answered for Andy, we are seeing backlogs grow in a couple of facets. One, the amount of orders we have in and then also things if it's not an order, kind of like an LOI and so forth. So I don't know at this stage or for this year, if we want to dimensionalize that publicly, but there is the potential as it continues to grow. It is a business that I think we're all very optimistic at the pace that, that business has in front of us.
Operator: Your next question comes from Deane Dray with RBC.
Deane Dray: How I'd like to circle back on some of the competitive dynamics and how it impacted price in the quarter. Just when steel being up year-over-year, that's really encouraging. Is that more a reflection of stronger volume? Any competitive changes there? And for PVC down, I know there's new capacity coming on. How much of that weighed on the ongoing PVC pressure? And this all kind of frames the question of when do you think you get a normalized year-over-year price? Is that -- it's going to be kind of hard to pinpoint which quarter, but is it still your expectation that it will happen this year?
William Waltz: Yes, Deane, I'll start and then for John or John if they, want to jump in there. So -- and with the multifaceted question, I think starting with steel, I think overall demands were strong. So I don't know, but I assume my competitors are also up there and also with imports going back, you did have a good market for us to grow and for us to get price and us to get margin. So market demand is strong and so forth. For imports and so forth there, I don't know -- again, I can't say specifically. I don't think it's necessarily more supply coming into the market as much as I would say, in general, us hitting our numbers and so forth there. It's probably what we perceived with price dynamics, both top line and spread and so forth. So in my mind, I'm pretty pleased that we're back -- I can't commit to the future, but we're back pegging pretty well how we think the markets are going to react. And I think to earlier comments from John Deitzer, we're still expecting spread compression within PVC. As to looking out and go, when does that stop, I may turn over to my peers, but at least for me, to try to peg one quarter with any precision is a little tougher there.
Deane Dray: That's really helpful. And then just as you talk about shifting some of the manufacturing resources to your core electrical, have you been able to size what you think your capacity increase is going to be, let's say, on a percent basis in conduit? Or will it be in other non-conduit electrolyte cable?
William Waltz: I think especially, Deane, think of more conduit and here's why to go -- if you think of what mechanical makes, it's our S&I, it is metal products. So therefore, Harvey, for example, one of our largest facilities, it is using the 80/20 rule effectively, which has actually, I think, helped the S&I margins to earlier questions of let's get with our key customers with key products, and we don't have to have 1,000 C items. So it's actually helping in our intention in the future to actually help the margins there. And then it is freeing up capacity for our electrical products to earlier conduits -- metal conduit specifically and to questions there that we just answered is where we are seeing volume growth. And with data centers and overall markets, it's a place that we would expect long-term growth. So it's working well to say what percent, but I think it's enough that we can keep up with the markets as we go forward. So it's kind of a win-win-win there and complement John Pregenzer and the rest of the team for really driving that effectively here.
John Deitzer: Just one thing to circle back on your earlier question and David's earlier question as well. It is a little bit difficult to predict the dynamics associated with price versus cost because there are so many different factors. One item that I think we're watching here in the near term a little bit is the volatility and fluctuation that we've seen in copper. If we just rewind like 6 months ago, it's up roughly 40%, give or take, from where we gave our outlook back in November, we're probably up around 25%. There's just been a lot of volatility there. And that would be one variable and also trying to make some of these assessments as we move forward. I mean these markets move quickly. And so that's one of the dynamics here that we're trying to watch and understand as we move throughout the year is that volatility a little bit. But I think the team has done a nice job because one of the facility closures is in the area where we use copper, and I think it's -- the team is working to improve the cost structure and try to be reactive to some of that volatility as well. So there's just a lot of moving parts and dynamics versus trying to pinpoint a singular, hey, this is when things change in one way or another.
Operator: Your next question comes from Justin Clare with ROTH Capital Partners.
Justin Clare: So just wanted to follow up on steel conduit pricing here. So I think it's the fourth quarter in a row that pricing has improved. So wondering if you could just speak a little bit to the trend you expect ahead? Do you anticipate continued price improvement in fiscal Q2? And then does the guidance for the year embed a continued upward trend in steel pricing? How are you thinking about that? And then just lastly, is the higher pricing supporting margin improvement for steel conduit, -- if you could speak to potential magnitude or how that's being affected?
William Waltz: Yes. So Justin, I'll start here and the team can add as always. So you are correct that steel conduit prices it's been 4 quarters so continue to go up with price. And also in most of those quarters, it's been up sequentially. And for example, our last quarter, probably our best quarter for spreads in a long time. So those things are moving. At this stage in our forecast, I don't think we're expecting meaningful spread increases. So -- but I also won't bake anything in to go for what we're guiding for us and say, oh, there's going to be so much more. Steel prices are expected, and I'm just going from different people's professional forecast that we use to continue to go up slightly over the next 6, 9 months here. So I think we can keep up with pricing, but I wouldn't expect a lot of extra spread or at least that's not baked into our numbers here.
Justin Clare: Got it. Okay. And then just one on the tariffs. I believe aluminum tariffs were potentially expected to have an impact on the cost structure. Wondering how that's evolving if you've secured domestic sources of supply and what the potential impact on the margins could be?
William Waltz: Yes. Again, without getting too specific on future steps, but you are correct, Justin, that for us, the tariffs because where we did get our products, our aluminum from offshore, at least offshore Canada, I'll be specific. So they are being impacted by the tariffs. We are looking at domestic sources, but I don't want to give out even if nothing else for our competitors. The probability of that because even simple things like that, getting to it through specs. And then also, I do think the domestic manufacturers back to they know that people like us and so forth are looking for domestic supply, they're raising the price. So how much of an arbitrage we have compared to our competitors or how much we can save compared to the tariffs is hard to quantify. But I will tell you, it has been an impact that I don't think we've passed along the impact of the 50% aluminum tariffs. That kind of ties back to John Deitzer's question or answer, excuse me, even though things like copper are so volatile right now that us predicting that our cable business is a little bit more challenging in the short term here.
Operator: Your next question comes from Chris Dankert with Loop Capital.
Christopher Dankert: I guess just to kind of circle back on solar, I think you touched on it in your prepared remarks, but I missed it. Can you just kind of give us a sense for what the solar activity is now, kind of how we're shifting capacity in that market? And then just kind of an update there.
William Waltz: Yes. So what we said, and then it's a great -- I'm glad you can say a setup question for us, is solar from the quarter, just with timing of projects was down from a year-over-year perspective. That said, we do have a good backlog there, almost to other people's questions on global mega projects of orders coming in, commitments from OEMs. And then the other thing that's helping us that we mentioned last year, but our facility Hobart that we make a lot of the solar torque tubes and is performing really well. So that does a couple of things. It helps drive some of the productivity we talked about for the first quarter. It helps with our overall estimates for productivity for the year and the increase in throughput is helping as this demand does come up here. So I think solar, like global mega projects should be a good thing for this quarter and quite frankly, the second half of the year. To earlier questions, you look at the step-up between what we're estimating for profits in Q1 and Q2 compared to what we need to deliver in Q3 and Q4 to hit the average of our numbers of $350 million EBITDA.
Christopher Dankert: As a point of clarification, I just -- I assume that the solar torque tubes were generally for domestic projects. Is any of that for export outside of North America right now?
William Waltz: Some. So I don't know long term how much will be, but it does -- one of our customers has ordered a meaningful amount here for projects overseas. But I don't know if that's a long-term trend or not versus the short term. So I think I would leave it at majority of our focus and our customers are North America-based with coincidentally short term, some projects going overseas.
Christopher Dankert: Got it. Got it. That's helpful. And then I guess just finally, on Hobart, any update as far as factory loading there, operational metrics, anything worth calling out either in terms of just being on track or any kind of wins or headaches there?
William Waltz: Yes, John?
John Pregenzer: Yes. No, Hobart is going well. obviously, bringing in the additional solar volume, but their operational rates are continuing to improve. A lot of the productivity that we delivered was contributed by Hobart. So I think everything is progressing as we need it to be.
Operator: This concludes the question-and-answer session. I would now like to turn the call back over to Bill Waltz for closing remarks.
William Waltz: Thank you. Let me take a moment to summarize my 3 key takeaways from today's discussion. First, Atkore's fiscal 2026 is off to a good start. Our results reflect a combination of healthy end markets and self-help productivity gains. We will continue to operate with a proactive mindset as we progress throughout the year. Second, we anticipate favorable market demand for the balance of the year as we reaffirm our full year outlook. Finally, as we execute previously announced strategic actions and evaluate additional opportunities, we are laser-focused on creating long-term value for our shareholders. With that, thank you for your support and interest in our company. We look forward to speaking with you during our next quarterly call. This concludes the call for today.
Operator: This concludes today's conference. You may now disconnect.