Vicente Reynal: Yeah Rob, we feel definitely that the acquisition of ILC Dover, we have now a very strong life science platform to build around. So not only on the biopharma, but also on this kind of CDMO, medical component technology that you even saw that we actually closed already on another acquisition control fluidics, even in the quarter, and that’s going to get added to that team. So that is just one example on how we expect to see, take a similar approach of tokens that you have seen us do in the past, and particularly around life science platforms. The exciting piece here too as well, is ILC Dover comes in with a phenomenal team and with deep experience and that already has a very strong funnel for both owns and tokens.
So again, putting our M&A engine into action is going to be very good for us and pretty fruitful. So the pipeline is very strong, not only on things that we had, but also on things that now the ILC Dover is bringing to the table. In terms of your question about the larger acquisitions, I mean, I still see that we like to say, we still have a couple of these kind of handful, one or two, very large or larger, above $1 billion purchase price that we keep track outside of this funnel that we talk about all the time, that the funnel is really more on the bolt-on and tokens. But yes, we still have a couple of those above $1 billion purchase price that we have at play.
Rob Wertheimer: Okay, thank you.
Vicente Reynal: Thank you.
Vikram Kini: Thanks, Rob.
Operator: Your next question comes from a line of Joe Ritchie from Goldman Sachs. Your line is open.
Joe Ritchie : Thanks. Good morning, guys.
Vicente Reynal: Good morning Joe.
Joe Ritchie : Hey, can we just start on the growth in the quarter? Was this — it was a touch lighter than we expected. Maybe this is just a follow-on to my question from earlier, but was there anything in the quarter that either shifted out or just potentially surprised you, was a little bit softer than you expected? Maybe it was just all in PST. Just any comments around that would be helpful.
Vicente Reynal: Hey Joe. If you remember, in the Q4 earnings call, we talked about being flattish, organic revenue, and we feel that the results are coming kind of roughly in line with that. And when you think about the difference between the Q1 results and the implied Q1 organic guidance, essentially, the change was basically largely attributed to the couple revenue orders that Vik mention of the call that got pushed out into Q2. Roughly $15 million of orders are basically attributable mostly to our two customers, and it was just basically site readiness, nothing to be worried about.
Joe Ritchie : Okay, all right, that’s great to hear. And then I guess you have been talking about the life sciences business for a while now and the softness in that business. It was interesting to see that you’ve seen the sequential order improvement in 1Q. Are you starting to kind of see green shoots in that business? Are you feeling better about the growth trajectory of that business throughout the rest of the year?
Vicente Reynal: We are, Joe, and particularly not only of the sequential improvement, but also the conversations that we’re having with customers and even also including some of the biotech funding that we’re starting to see here kind of coming through as well. So yeah, I mean I think it’s one that we’re encouraged to see, not only from the numbers that we just posted, but also from the conversations that we’re having with customers about new applications and new technology. So yes, very encouraging.
Joe Ritchie : Okay, great. Thanks guys.
Vicente Reynal: Thank you.
Operator: Your next question comes from a line of Andy Kaplowitz from Citigroup. Your line is open.
Andy Kaplowitz: Hey, good morning everyone.
Vicente Reynal: Good morning, Andy.
Andy Kaplowitz: Vicente, they said you mentioned large project order timing was a big reason why organic orders were down in Q1, but how would you characterize the large project order environment ‘24? Do you have visibility that you’ll see another large project bookings quarter like you had in that Q1‘23 at some point soon? It’s truly a timing issue or is it more difficult market for large projects to get over the finish line?
A – Vicente Reynal: No Andy, I think we definitely categorize it more as really timing and we do, because as we mentioned on the prepared remarks, I mean these renewable natural gas saw a lot of acceleration early in ‘23 and it has not stopped, but I mean it’s basically a very, very fast start and then kind of tapering down. Still we’re seeing renewable natural gas growth or good orders, it’s just that comparable to what we saw back in Q1, it was just difficult to overcome. And same thing with the electric vehicle investments that happened in China. Again, very strong investments happening in terms of expansion in the first half of last year. And do we see electric vehicle continue? Yes, we see it, but not at the pace of what we saw there.
Now, having said that, I think what the remark that we made on the – or one of the answers that I made before, formal activity is really strong. I mean so I think that’s what is very, very encouraging to us, is that – and it is not on those same projects. It’s kind of now a new type of mega projects that we’re seeing whether in petrochem expansions or things of that nature that are kind of encouraging that we’re seeing.
Andy Kaplowitz: That does sound encouraging. So Vicente, just following up on your geography comments, specifically on China. I think last quarter you suggested the Chinese team was pretty energized. It looks like APAC order is still had enough tough year-over-year comp. But does China turn here as you go over into the second half in terms of owners? Like any sort of more characterization would be helpful.
A – Vicente Reynal: Yeah, I’d say Andy, I think the team is still very energized and very encouraged about what they’re seeing. Clearly tough comps, but even in the tough comp environment, when you look at, and we’ve done a lot of work with the team to better understand the kind of core business. The core business still is pretty solid and seeing some good momentum. It was just basically one of those where, again, difficult comps based on some of the expansion that we saw rapidly happening in China in the first half of last year, particularly on electric vehicle and battery production and solar energy. But again, we’re encouraged with what we’re seeing here. As a matter of fact, I mean next week I’m actually in Southeast Asia with the team to look at some of the growth initiatives that we have across Vietnam, Indonesia and Singapore, and I’m super energized to just be with the team there next week.
Andy Kaplowitz: Thanks for all the color.
A – Vicente Reynal: Thank you.
Operator: Your next question comes from a line of Nigel Coe from Wolfe Research. Your line is open.
Nigel Coe: Thanks, everyone. Good morning.
Vicente Reynal: Good morning, Nigel.
