Dave Zapico: AMETEK has historically bought through both upcycles and down cycles. And sometimes you can get your best deals during a down cycle. And you have to be cognizant of what the forward-looking EBITDA is not really the trailing, but the forward. So, it’s something that we’ve been keenly aware of for years, and we’re focused on it.
Joe Giordano: Thanks, guys.
Dave Zapico: Thank you, Joe.
Operator: And our next question today comes from Rob Mason of Baird. Please go ahead.
Rob Mason: Yes, good morning.
Dave Zapico: Hello, Rob.
Rob Mason: Hey, Dave. Good morning, good morning. Dave, I’m just going to see if you could drill into the process segment a little more, you called out Ultra Precision with relative stronger growth, does that carry forward into ’23 just in terms of what leads that part of the business? And then just maybe higher level anyway to cut the mix of what that process segment, that sales into more of an R&D function versus more of a production environment?
Dave Zapico: Yes, that’s a good way to think about it. And I’ll try to put some more color into that. I mean, if you look at 2022, what stood out was our healthcare component. And our healthcare component is a big part of process across all of AMETEK, it’s about 50% of sales, but it’s a big part of the process. And I’ll give you an idea. And Q4, our rolling business was up 20% organically, so they’re really doing a good job. And that market has — hospital spending has been fantastic for us, and people were putting in new systems post-pandemic. Also the semiconductor markets about 6% of sales, and the vast majority of that is in process and the semiconductor market was up high single-digits in the Q4. And we think in 2023, there’ll be a slight downtick there, that’ll be up low-to-mid but still growing because we have a lot of applications and research and also in the areas that are continuing to grow.
So, we’re in the right places in semiconductor. So, you got healthcare, you got semiconductor. You got the research market where we’ve had with our CAMECA business just every lab in the world has to have one of our atom probes, every lab in the world has to have some of our SIMS products. So, their backlog is really good. And they’re doing well. And then, you got the old traditional oil and gas part of process. And that’s doing very well in Q4, it was up high-single-digits. And for all ’22, it was up low double-digits. And for ’23, we expect plus high-single-digits. So, process is doing very well. And we think it’s going to continue in the future.
Rob Mason: Excellent. That’s very helpful. Just as a follow-up, could you speak to how you think the incrementals will look for EIG versus EMG, in ’23 they were, EMG was certainly very strong in ’22. But just how did those look going forward comparatively?
Dave Zapico: Good question. In terms of incrementals, in both groups, I think the core incrementals will be up 30% to 35%. And I think the core and reported margins will be up 30 to 40 Bps. So, we really think we have a clear line of sight to grow margins. Again, there’ll be healthy incrementals. And we’ll be able to increase our core margins as we go forward.
Rob Mason: Very good. Thank you.
Dave Zapico: Thank you, Rob.
Operator: And our next question today comes from Steve Barger at KeyBanc Capital Markets. Please go ahead.
Steve Barger: Hey, good morning, guys.
Dave Zapico: Hello, Steve.
