Watsco, Inc. (NYSE:WSO) Q1 2024 Earnings Call Transcript

Page 4 of 4

Steve Tusa: Okay. And then just one last one just on from an end-market demand perspective and putting weather aside, are you seeing anything on repair versus replace any kind of change-up there?

Al Nahmad: Nope. Not yet. Still too early. There just hasn’t been any — if you put weather aside, there is nothing.

Steve Tusa: Yeah, okay. Thanks. Thanks as always for the color. Appreciate it.

Operator: The next question is from Chris Dankert with Loop Capital. Please go ahead.

Chris Dankert: Hey, good morning, guys. Just one quick question for you here, I guess. Explicit technology spending in the quarter, is that still kind of running at about a $14 million run-rate? And is there anything that you’d kind of be teasing us with or anything explicit worth highlighting in the quarter on the technology side beyond on call air or just anything else on that technology front?

Al Nahmad: I’m sorry I didn’t understand the question. Do you A.J.?

A.J. Nahmad: Are there new things to talk about on the technology side? Is that the question?

Chris Dankert: And then just the spending run-rate and then is there anything new you’re introducing or would call-out here?

Al Nahmad: No, well, if we’re going to introduce it, we’ll introduce it. We’re not going to — I mean, we’re constantly introducing new ideas. As far as the pure SG&A, if that’s your question, there’s not much change in the technology spend this quarter sequentially from last quarter, if that’s your question.

Chris Dankert: It was. Thank you. Well, thanks, fella. Appreciate it.

Paul Johnston: You can expect us to keep innovating on the technology side though, for sure.

Operator: The next question is from Stephen Volkman with Jefferies. Please go ahead.

Al Nahmad: Good morning, Stephen.

Stephen Volkman: Great. Thanks for fitting me and good morning, everybody. Barry, I wanted to ask you about credit quality, if that’s okay. So…

Al Nahmad: Very good.

Stephen Volkman: I mean, all seriousness aside, I was curious, I know that you guys — I’m help — grateful for that commentary, but I know you guys also do sort of some origination, I don’t know brokering, how you want to think about it for the end-customer financing as well. I think that’s available through some of your platforms. And I’m curious if you have visibility into how that credit quality looks.

Barry Logan: Well, we don’t hold. Yeah, go ahead, A.J.

A.J. Nahmad: I was going to say the same thing. So it’s not origination, it’s really matchmaking between our customers and their — well, actually our customers’ customers and financing sources. We do a small amount of that and it’s pretty stable, I would say, but we do not. Once we make that matchmaking, we are out of the picture and don’t have visibility, frankly, into the performance of those loans.

Stephen Volkman: Okay, got it. Thanks. That’s all I had.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Al Nahmad for any closing remarks.

Al Nahmad: Once again, thanks very much for your interest in our company. We look-forward to conversing with you as time goes on. Bye-bye.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.

Follow Watsco Inc (NYSE:WSO; WSOB)

Page 4 of 4