Q: What are Atkore’s expectations for PVC conduit pricing for the rest of the fiscal year? A: William Waltz, President and CEO, mentioned that while it’s challenging to predict future pricing, the guidance from the last quarter remains their best estimate. Pricing has continued to decrease, but it aligns with their expectations for earnings and overall performance.
Q: Can you provide insights into Atkore’s market share for PVC conduit? A: William Waltz stated that Atkore remains a leader in the market, although precise market share numbers are difficult to determine due to the nature of the product and market dynamics. Imports are increasing, but Atkore continues to maintain its leadership position.
Q: How do tariffs impact Atkore’s business, particularly in terms of steel and PVC imports? A: William Waltz explained that tariffs generally benefit Atkore, especially with the 25% tariff on steel conduit imports. While PVC imports have increased, the impact of tariffs is expected to help Atkore reclaim market share and improve gross margins over time.
Q: What is the significance of PVC conduit in Atkore’s long-term business strategy? A: William Waltz emphasized that PVC conduit remains a key part of Atkore’s business. Despite increased competition and imports, it fits well within Atkore’s strategy of providing comprehensive solutions to customers, and the company continues to invest in productivity improvements.
Q: How does Atkore view the potential impact of competing technologies on its HDPE pipe and conduit products? A: William Waltz noted that the impairment charge for HDPE assets was influenced by the emergence of competing technologies, such as satellite internet, which could impact fiber optic cable demand. This was a key factor in their decision to take the impairment charge.
Q: What are Atkore’s expectations for volume growth in the second half of fiscal 2025? A: William Waltz mentioned that while the first half of the year was flat, they expect mid- to high single-digit volume growth in the second half, driven by strong demand in certain product areas like metal framing and cable management.
Q: How does Atkore plan to navigate the current macroeconomic uncertainties and potential project delays? A: William Waltz acknowledged the unpredictability of the economic landscape but expressed optimism about the demand for U.S.-made products. The company is balancing the positive impact of tariffs with potential volume challenges due to project delays.
Q: What is Atkore’s approach to capital deployment and shareholder returns? A: John Deitzer, Vice President of Finance, highlighted Atkore’s commitment to a balanced capital deployment model, focusing on returning cash to shareholders through share repurchases and dividends, while also investing in growth initiatives.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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