Nicole DeBlase: Got it. Very clear. And then maybe on Europe you guys spoke about how you’re kind of anticipating maybe some Europe weakness coming through in the second quarter. Is that something that you guys actually saw in your order trends? Or are you just being a little bit cautious based on what you are hearing. Thank you.
Beth Wozniak: No. Yes, we did see that in our order trend through Q1 that Europe was definitely softer than North America and Asia Pacific.
Nicole DeBlase : Thank you. I’ll pass it on.
Operator: Our next question comes from Vlad Bystricky with Citi. Please go ahead.
Vladimir Bystricky: Hi, good morning. Thanks for taking my call.
Sara Zawoyski : Good morning.
Vladimir Bystricky: So I just wanted to follow up on that last question and comment from Nicole about Europe. Can you just give us more color on what’s contemplated in guidance for the rest of the year in terms of potential for incremental weakening in Europe going forward?
Sara Zawoyski: Well, here is what I would say is that we were pleased with the Q1 performance where we actually grew Europe overall in Q1. And so what we are suggesting here is in that Q2 guide, we are not expecting growth here in Europe. And I think, it really reflects some of the order trends that Beth alluded to.
Vladimir Bystricky: Okay. That’s helpful. And then can you — can you just give us an update on what you are seeing in terms of underlying growth at ECM and how you are progressing on synergy capture there versus your expectations?
Beth Wozniak: Yes. When we look at ECM, that business had several different channels. And I would say ECM has performed very similar to what we’ve seen our EFS business. I would say, they have a stronger retail channel. And so that’s Retail Resi, that’s been a little softer, and that was our comment about we expect that to continue to be soft. But I think, as we’ve been working on a lot of our sales synergies. And as Sara commented on, we expect to see that start to layer in, in the back half of the year. And so that is everything from bringing some of that product through our rep and distribution network, as well as into taking some of those products and bringing them — making sure that they’re certified so we can bring them into Europe.
So all of that activity is underway. And I’ll say this, one of the things when we acquired that business, they certainly had supply chain challenges and availability challenges and we’ve worked very hard to improve that situation. And what’s been encouraging is that we’ve seen and heard from our customers, we see some of that — those orders pick up where we have improved the delivery situation. But overall, ECM is a great acquisition for us, and we think it just extends our portfolio in power connection solutions. And so we see great potential for the synergies to play out over the next several years.
Sara Zawoyski: And maybe just a quick add on the cost synergy side. So I’d just say, we’re well on track. As we acquired ECM, we were really excited about it from the growth side, but we also did see some cost synergies there in that $10 million to $15 million mark by year three. And I would say that we’re well on track to deliver that. We are seeing material procurement synergies, logistics — indirect. I think too, on the cash tax synergies, we now expect closer to $10 million per year versus the $6 million to $8 million previously that we had discussed. And then lastly, we talked about in 2024 with that acquisition being accretive to EPS and that $0.07 to $0.08. And so we saw a strong $0.06 contribution here in Q1. So contributing overall very nicely.
Vladimir Bystricky: Great. That’s really helpful. I’ll hop back in queue.
Sara Zawoyski: Thank you.
Operator: Our last question comes from Brian Drab with William Blair. Please go ahead.
Brian Drab: Just a couple of small clarifications at this point. But in EFS, I think you said that the sell into the channel was up low single digits. The sell-through is positive. Can you just put a finer point on that? What does positive mean exactly? I mean sell-through is up slightly year-over-year?
Beth Wozniak: Well, our comment was more around all of nVent, right, that we just saw positive sell-through, so low single digits.
Brian Drab: All right. So positive means low single digit?
Beth Wozniak: Yes.
Brian Drab: Okay. Got it. Okay. And then in the Commercial business, you mentioned that things are looking better — or sorry, in the Thermal business that you mentioned things are looking better, Commercial and Resi. Is that back to growth in the first quarter? Or — or is it just improving sequentially? And then also, I was curious you said the energy end market was the only one that was trouble point in the first quarter. Does that mean that energy was the only end market that you saw a decline year-over-year in the first quarter within thermal? Thanks.
Beth Wozniak: So I’m just going to — just for clarification. So overall, for nVent, Commercial Resi was positive. And overall for nVent, energy was down and that was primarily due to the Russia impact. For thermal specifically, we’ve seen Commercial Resi improving, so not quite yet back to growth, but it is improved for the last several quarters. And certainly, Thermal has been impacted by energy the most because of the Russia impact. And we have one more quarter that will lap here in Q2 with Russia, the Russia exit.
Brian Drab: Okay, that helps. Thank you very much.
Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Beth Wozniak, Chair and Chief Executive Officer for any closing remarks.
Beth Wozniak: Thank you for joining us today. I’m very proud of the performance we delivered in the first quarter. We will continue to focus on delivering for our customers, employees and shareholders by executing on our growth strategy. We believe nVent is a top-tier high performance electrical company, well-positioned for the electrification of everything, sustainability and digitalization trends. Thanks again for joining us. This concludes the call.
Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.
