Greg Lewis: And Julian, if I could add just one last thing there. From a modeling perspective, keep in mind it’s not just a dynamic embedded in our model for 2024, second half likely stronger than the first half. It’s also that second half 2023 was weaker than first half 2023. So both of those will influence the year-over-year growth rate as you’re talking about exiting 2023 versus exiting 2024.
Julian Mitchell: That’s great. Thank you.
Operator: Thank you. Our next question comes from the line of Scott Davis with Melius Research. Your line is now open.
Scott Davis: Hey, good morning, Vimal and Greg and Sean.
Vimal Kapur: Good morning.
Greg Lewis: Good morning.
Scott Davis: Good morning. Guys, can we take a step backwards at least and just walk around the world a little bit on what you’re assuming? I assume, Vimal, you probably have pretty good read on what’s going on in China. It’s been a tough region for a lot of your peers, but you don’t need to really focus on Aerospace because it’s a different dynamic. But for the other businesses, perhaps just a little bit of color on what you’re expecting, any differences in 2024 geographically versus 2023. That’d be helpful. Thanks.
Vimal Kapur: Yes, thanks, Scott. So, specifically talking about — let me start with China. We grew about 7% in 2023. I don’t expect a material shift between 2024 to 2023. We have weathered a tough year in 2023, China’s economic cycle. And I expect 2024 to be a shade better, but it’s no more going to be a source of high growth, what it used to be five or seven years back. Speaking more broadly of high growth regions, which represents almost 25% of the Honeywell revenue now. We had very good performance in Middle East and India in particular, and we expect those trends to continue in 2024. India grew for us high double digits. In 2023, we had very meaningful revenue there, similar good performance in the Middle East, so we expect those regions to perform well.
All in all, I expect high-growth regions to grow double-digit, which will be a source of organic growth, about a percent, and overall Honeywell algorithm of organic growth. Europe remains challenging. We have seen headwinds in some portions of our businesses and tailwinds in some other portions. So net-net, it’s more neutral to negative. And US, of course, we are like everybody else, waiting for interest rate environment to settle. And that will determine the performance of our business, specifically on the short cycle. So that’s kind of my broad overview of how we see different geographies.
Scott Davis: Okay, that’s helpful. And then a little bit of a nuance here. Would you classify the Carrier deal as a bolt-on? It seems like a little larger than a bolt-on by my definition, but kind of curious how you think about it, because clearly in your slides you mentioned bolt-on deals being the focus and if we were to expect other kind of like billionish…
Vimal Kapur: I would call it bolt-on, because my argument is that, bolt-on to me is which is adding to our core portfolio and propels the growth of organic growth of the business itself. So that’s what this business is. If you see our Buildings Products business, our strategy is to have products which are specified, which are critical for the building. We had a moderate position in security with the addition of this portfolio makes us a meaningful player. And therefore I call it a bolt-on, because it’s a continuum of our strategy. We’re not finding a new adjacency. We’re not exploring some new idea. It’s something we understand extremely well. And therefore, our confidence to add shareholder value here is extremely strong.
Greg Lewis: And keep in mind, at $5 billion, it’s something like 4% of our market cap. So reasonably, it’s not a huge bet as it relates to that as well. Obviously, very different world than when our market cap was half that 10 years ago.
Scott Davis: Sure. Understood. Thank you, guys. I’ll pass it on. Good luck this year.
Greg Lewis: Thank you.
Operator: Thank you. Our next question comes from the line of Andrew Obin with Bank of America. Your line is now open.
Andrew Obin: Yes, good morning.
Greg Lewis: Good morning, Andrew.
Andrew Obin: Hey, just looking at UOP, I was a little bit surprised by the growth in the quarter. I would have thought with STS being strong, and I know you sort of gave us, I think it was a gas product, but can you just tell us what kind of visibility do you have on this business accelerating into 2024? Because it is sort of, I guess, that’s what you’re guiding to, but just a little bit more granularity there. Thank you. Sure.
Vimal Kapur: Sure, Andrew. So 2023 revenue is 1% growth. It’s primarily driven by equipment revenue we had in the prior year. We had large equipment-based projects in our volume, LNG projects. So on a year-on-year comp basis, don’t repeat itself. But if you see the core UOP business on catalysts, it remains pretty strong. Your specific question on sustainability technologies, as we mentioned during our earnings earlier, remain very confident on its performance. We crossed the benchmark of 50 licenses of sustainable aviation fuel just a few weeks back. Now we are seeing activity in carbon capture projects, early innings on hydrogen projects. So our plans to have sustainable technology business of $1 billion in next few years haven’t changed. And my confidence of that absolutely has only grown higher over the last few months.
Greg Lewis: Yes, and I would also just zoom out. I mean, we talk about some of the variability in this business, and PMT has always got some of the highest variability with UOP being a big part of that. Keep in mind, we grew sales in UOP for the year, something like 8%. Very, very healthy. And we’ve also grown orders somewhere in that same neighborhood, I think 2% for the year, but with 13% in the catalyst business. So we’ve come off some big comps with the large LNG projects. Overall, this is a very healthy business with a very healthy backlog. So — and as you said, the STS business provides a really nice catalyst on that new aspect of it, but we feel very good about where UOP is at this stage.
Andrew Obin: Excellent, and just to follow up on advanced materials. I guess same question, the business has returned to growth, just what are you seeing, maybe in a little bit more detail, driving positive outlook for 2024. I think [indiscernible] is constructive there as well. And maybe you can throw in a lot of questions on semis. I guess that’s part of it as well, just if you expand on that. Thank you.
Vimal Kapur: Yes. Thanks, Andrew. Yes, we do see recovery in semis modestly increasing. Every month is becoming modestly better. So that’s part of our forecast for 2024. We also saw in Q4 recovery in some segments of chemicals in short cycle. And we expect that to roll over in 2024. So the short cycle recovery on a broader Honeywell portfolio is not a one event. So it’s going to happen in different portions. So chemicals happened late Q4 and we expect that to continue. So all-in-all, advanced material should have a better year in 2024 compared to what we had in 2023.
Andrew Obin: Thanks so much.
Vimal Kapur: Thank you.
Operator: Thank you. Our next question comes from the line of Nigel Coe with Wolfe Research. Your line is now open.
Nigel Coe: Thanks. Good morning. Thanks for the question. And Vimal, congrats on the Chairman role. There’s lots of modern questions, so here’s a few more. Well, a couple more. Pricing, I’m not sure if you’ve caught up price, but maybe if you just talk about what you’ve [indiscernible] pricing in your revenue bill. But it seems that we’re entering the year with two of the segments down pretty heavily. Maybe just talk about how you see that break back to growth for IA and ESS. Is that in the second quarter, is it more second half loaded? And perhaps maybe talk about what you’ve seeing in the order rates to maybe support the view that we are at the bottom in some of these markets?
