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Operator: Greetings. And welcome to Mirion Technologies Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Alex Gaddy. Thank you. Mr. Gaddy, you may begin.

Alex Gaddy: Good morning, everyone. And thank you for joining Mirion’s fourth quarter and full year 2022 earnings call. A reminder that comments made during this presentation will include forward-looking statements and actual results may differ materially from those projected in the forward-looking statements. The factors that could cause actual results to differ are discussed in our annual report on Form 10-K and quarterly reports on Form 10-Q that we file from time-to-time with the SEC under the caption Risk Factors and in Mirion’s other filings with the SEC. Quarterly references within today’s discussion are related to the fourth quarter and full year ended December 31, 2022. The comments made during this call will also include certain financial measures that were not prepared in accordance with Generally Accepted Accounting Principles.

Reconciliation of those non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the appendix of this presentation accompanying the call today. All earnings materials can be found on Mirion’s IR website at ir.mirion.com. Joining me on the call today are Larry Kingsley, Chairman of the Board; Tom Logan, Chief Executive Officer; and Brian Schopfer, Chief Financial Officer. Now I will turn over €“ turn it over to our Chairman of the Board, Larry Kingsley. Larry?

Larry Kingsley: Thank you, Alex and good afternoon, everyone. I’d like to get today’s call started by thanking you all for your continued support of Mirion throughout our first full year as a public company. 2022 was a dynamic year for Mirion, from navigating a challenging supply chain environment, to responding to record inflation and the Russia-Ukraine conflict. There was no shortage of hurdles to overcome. I am incredibly proud though the Mirion team’s resolve in the face of adversity, we believe the solid results we reported this morning are a direct testament. Our Medical business accelerated upon recent growth trends, while Industrial took a meaningful step forward during the quarter. Overall, the team was able to deliver on expectations laid out on our last call and has built positive momentum heading into 2023.

Mirion has positioned itself well to deliver growth this year and I believe the guidance published this morning showcases the cycle-resistant nature of our strategic positioning in the market. Mirion’s diverse portfolio of products and services, and experienced management team have a long track record of proven results. The team has the right roadmap in place to capitalize on what we expect will continue to be a robust demand environment. We are entering 2023 with strong momentum across our end markets and a growing backlog. I am also very encouraged by the execution focused mentality we built through the course of 2022 and the team has clear focus on the key strategic initiatives required for growth, profitability and cash flow generation.

The future for Mirion is bright, customer engagement and demand are strong and our teams remain committed to executing. Now I am going to turn the call over to Tom Logan, Mirion’s CEO. Tom? Tom, I think, you are muted.

Tom Logan: Diving into our results, there are few key areas I’d like to highlight today. First, we finished the year with 8% year-over-year order growth for the full year, which in turn resulted in backlog growth of 10%. This excludes the impact of the Honey Kevie project cancellation as previously discussed. Second, we delivered total company organic adjusted revenue growth of over 19% for the quarter and nearly 6% for the full year. While, these numbers could have been higher without the negative impacts from the Russia-Ukraine conflict and foreign exchange pressures, I am incredibly proud of the effort and commitment displayed by our team. Third, net leverage reduced to 4.4 times EBITDA as of December 31st, driven by better free cash flow performance in line with our expectations.

Note that my goal is to reduce leverage below 4 times by the end of 2023. Finally, we initiated 2023 financial guidance this morning. Looking ahead to the full year, we are expecting organic growth of 4% to 7% with adjusted EBITDA of $172 million to $182 million. Now, let’s get into more detail on our order performance and market outlook for 2023. Beginning with slide four, our end market demand dynamics remains strong heading into 2023, showcased by 8% year-over-year order growth in 2022. On a constant currency basis order growth was 13% for the full year. We continue to see broad-based demand across business segments and are encouraged by our robust backlog coverage. We expect conversion rates to increase materially in 2023, covering approximately 55% of our next 12-month revenue.

On the Medical side of the business, we experienced incredible growth dynamics last year and expect to see these positive trends continue, albeit at a more moderated rate. Year-over-year medical order growth was 14% or 15% on a constant currency basis. A few things to note here, first, we launched our One Mirion Medical Strategic Initiative, which was begun delivering positive results to the business. I expect to see additional momentum take shape both internally and externally as 2023 progresses. In dosimetry, we are excited about the official launch of our next-generation of Instadose technology. As a reminder, we expect Instadose to provide growth to the business through licensing opportunities, organic share gains and conversion of existing customers to the platform.

Next, in radiation therapy quality assurance, we remain encouraged by both international and domestic demand dynamics. We are expecting high single digit topline growth from RTQA in 2023, supported by the investments in our European sales center and national account marketing strategy to drive positive growth for the business. Finally, 2022 was a great year for our nuclear medicine business, showcasing how strong the combined Biodex and Capitec assets are for Mirion. We are anticipating a more normalized growth rate in 2023 with organic revenue growth expected in the mid-single digits. Now, moving onto Industrial, this segment generated approximately 5% order growth on an as reported basis in 2022, roughly 14% on a constant currency basis, supported by a strong customer engagement across our end markets.

In nuclear power, we are seeing encouraging activities in all areas of the nuclear power lifecycle, particularly from newbuilds and the installed base. Government sponsors across the globe continue to view nuclear power as an attractive energy source, particularly in Europe and Asia. The macro environment remains favorable and we are encouraged by the long-term trends in the space. Relatedly, the small modular reactor movement has been building steam across the world. We are seeing SMR-related orders hit our books and are strategically engaged with prospective customers as they ramp up development work. This is a great long-term opportunity for Mirion, which could dwarf utility scale reactors and we look forward to playing an integral role in enabling the safe development and operation of these potentially game-changing power solutions.

Moving onto our Defense and Diversified Industrial businesses. We lapped a number of large orders in Q4 2021, which made 2022 comparisons tough. We continue to see elevated engagement from our NATO customers in the Defense space and expect this trend to continue for the foreseeable future. Note, however, that order cycle times are lengthier than historical norms. Finally, in Labs and Research, we booked a large order providing germanium detectors, dosimeters and hand-held devices to new oncology isotope production facility in Germany. This is an exciting order for us in the Industrial segment, as it was made possible by the strengthening Mirion Medical brand. As we continue to mature in our two segment structure, we expect similar cross selling momentum to pick up.

Looking at the business as a whole, the outlook for 2023 is strong. We expect elevated customer engagement across our end markets and are maintaining robust growth projections for the future. Let’s turn now to slide five to discuss our fourth quarter and full year results in more detail. At the total company level, we delivered 19.1% organic revenue growth in the fourth quarter and 5.7% organic revenue growth for the full year. We enjoyed continued exceptional performance from our Medical business in the fourth quarter and full year, delivering organic growth of 24% and 15%, respectively. Strengthen in Medical was broad-based across all three of our end markets with nuclear medicine leading the way. In the Industrial segment, the fourth quarter was a step in the right direction, as we delivered nearly 17% organic growth.

Fourth quarter growth was supported by improvements in our operating environment, as well as strong execution by our team. We saw some signs of supply chain pressure easing and we experienced generally more favorable order timing dynamics compared to prior quarters. Before I pass the call over to Brian, I wanted to touch briefly on our business development initiatives and M&A strategy. We remain committed to our disciplined capital allocation policy with highly selective screening criteria for M&A that supports our deleveraging commitments. The pipeline remains robust and our criteria for investment continues to focus on building category leadership within our chosen end markets with defensible products, services and software offerings. But to be clear I intend to reduce leverage below 4 times by year-end.

With that, let me pass the call over to our Chief Financial Officer, Brian Schopfer. Brian?

Brian Schopfer: Thanks, Tom, and good morning everyone. To kick off my commentary, I will ask you to please turn to slide six to take a deeper dive into our fourth quarter and full year results. Looking at the fourth quarter, total company adjusted revenue was up 20.5% and adjusted EBITDA was up 25.9%. Total revenue in the quarter was $217.9 million and organic growth was 19.1%. Adjusted EBITDA totaled $56.4 million in the quarter, with margin expanding 110 basis points to 25.9%. During the fourth quarter, we realized approximately 5% growth from price, offset by inflation and one-time costs associated with accounts receivable reserves, as well as a one-time supply chain reserve relating to circuit boards. Looking at the full year, total company adjusted revenue was $717.8 million, featuring 5.1% reported growth with organic growth of 5.7%.

Adjusted EBITDA was down slightly compared to 2021 finishing at $164.7 million with adjusted EBITDA margin contracting 130 basis points compared to 2021 to 22.9%. As a reminder, year-over-year adjusted EBITDA perform — margin performance was negatively impacted by approximately $12 million of public company costs in 2022 or approximately 170 basis points. This was our last time comping against a period without public company costs. Fourth quarter adjusted free cash flow was $19.5 million, much more representative of the go-forward expectation for the company. Higher interest rates and net working capital requirements continue to be a challenge, but I am encouraged by the progress exiting the year. As a result, we saw leverage reduced to 4.4 times as of December 31st, slightly ahead of what we guided on our third quarter call.

Looking forward, our operating teams are very focused on achieving Tom’s leverage target of 4 times or lower by the end of 2023. I’d also like to note that foreign currency exchange dynamics continue to be an important area of focus for Mirion. While we have recently seen positive trends in the euro to U.S. dollar exchange rate, FX headwinds impacted adjusted revenue performance by 5% in the fourth quarter and 4.5% for 2022. As we disclosed in our third quarter call, we have been actively hedging our interest rate exposure through fixed price cross currency hedges on our third-party debt. We have executed to hedges, bringing our total fixed debt to approximately 30%, which we expect to offset approximately $4 million of cash interest on an annualized basis.

Before getting into the segment details, I’d like to take a minute on slide seven to reflect on the key variables impacting our topline in 2022. There was no shortage of headwinds in 2022. We had to overcome challenges stemming from the Russia-Ukraine conflict, foreign exchange pressure and record inflation. Our topline was affected by approximately $50 million of headwinds from lost Russian related revenue and negative foreign exchange impacts, totaling approximately 8% of reported revenue growth. We were able to replace $12 million of the lost Russian related volume, supplemented with $6 million of incremental pricing actions, while successfully acquiring and integrating the Collins acquisition. Let’s now take a deeper dive into segment performance.

Please turn to slide eight for our Medical segment. Starting with fourth quarter performance, adjusted revenue grew 25.4%, with organic growth of 23.6%, driven by double-digit organic growth from all three end markets. nuclear medicine led the way again this quarter, as integration efforts continue to deliver good results and the team converted more of our backlog into revenue. Medical adjusted EBITDA margin was 33.4% in the quarter, a 90-basis-point expansion compared to the same period last year. For the full year Medical adjusted revenue grew 19.2% with organic growth of 15.2%. Adjusted EBITDA was up 23.3% to $86.8 million. Margin improved by 110 basis points, supported by strong price realization in the integration of Capitec and Biodex.

These growth numbers are outstanding and I’d like to commend our medical team on their great work throughout the year. As we look forward Medical’s first half of 2023 will see a more normalized growth trend in line with our long-term algorithm with tougher comps in the back half of the year. Let’s now turn over to slide nine for the Industrial Segment. Adjusted revenue grew by 17.9% for the quarter with organic growth of 16.8%. We set strong but achievable expectations for Industrial in the fourth quarter and I am proud of the effort our team put in to deliver. Performance was principally driven by strong execution. Adjusted EBITDA for the Industrial segment was up almost 22% in the quarter and margin expanded 100 basis points to 30.2%. While I am pleased to report margin expansion, performance was limited by the incurrence of one-offs transitory costs related to increased accounts receivable provisions and one-time supply chain expenses, as I noted earlier.

Looking at Industrial full year performance, adjusted revenue was down 2% with organic growth of 0.9%. Revenue performance was principally hindered by foreign exchange headwinds and lost Russian related revenue. A revenue impact of roughly 11% for the year on the Industrial Segment. Adjusted EBITDA was down 5% and margin compressed by 90 basis points from 2021. Margin performance was impacted by volume absorption, product mix and inflation. Additionally, dilution from the Collins acquisition negatively impacted Industrial adjusted EBITDA margin by nearly 40 basis points on its own. Finally, I’d like to walk through the guidance we have issued today. Turning over to slide 10. We are projecting organic growth of 4% to 7% supported by mid-single-digit organic growth from both Medical and Industrial.

I’d like to note that Medical is comping a very strong year, and as a result, we are moderating our growth expectations versus what we saw in 2022. Given recent trends in the U.S. dollar to euro exchange rate, we are anticipating FX to positively impact topline growth by about 0.5%. Net inorganic revenue impact — the net in organic revenue impact from Collins and Biodex is expected to be 1.5%. To provide a quick update on the physical medicine divestiture from our Biodex business, originally announced in November, we expect the deal to close during the first quarter of 2023. As a reminder, we purchased Biodex and Capitec for a combined $41 million, representing approximately $60 million of revenue and less than $2 million of adjusted EBITDA at deal closure.

Today, the combined business post synergy multiple is below 2 times. It is accretive to Mirion’s consolidated adjusted EBITDA margin. The physical medicine component of Biodex is non-core to our category leadership in this segment. For 2023, we are expecting adjusted EBITDA between $172 million and $182 million with margin — with margins likely remaining unchanged to 2022 at the mid-point of guidance. Pricing, cost inflation are estimated to be neutral for the year. Thinking through the sequence of the year, we expect more modest performance in the first half as we work through product and customer mix headwinds, mainly stemming from our sensing business within the Industrial Segment. We anticipate these mixed pressures to ease as we get into the second half of the year with adjusted EBITDA margin improving sequentially.

I’d also like to note the dynamics coming from our inorganic contributions. We expect the Biodex divestiture to be accretive to margins, but the Collins acquisition more than offsetting these benefits. As a result, we project net inorganic impact to our adjusted EBITDA margin of approximately negative 50 basis points in 2023. Saying this differently, we would expect 50 basis points of better margin rates than what the mid-point suggests had we not done both of these deals. We are anticipating adjusted EPS of $0.28 to $0.34 and adjusted free cash flow of $50 million to $70 million, with an expectation of positive contribution from net working capital for the year. To help with modeling considerations, we are utilizing our share count as of December 31, 2022 to calculate EPS.

We expect our effective tax rate to be between 25% to 27% and are assuming a U.S. dollar to euro exchange rate of 1.07. Note that there is an additional guidance slide in the appendix of our presentation, laying these out, as well as a bridge around our revenue assumptions. With that, I will pass the call back to Tom to close things out.

Tom Logan: Brian, thanks. Before we open things up for questions, I’d like to recap 2022 and highlight a few key areas of focus for us we prepare for 2023. First, we finished 2022 with positive momentum built off our strong fourth quarter results. Our team’s commitment to execution enabled us to deliver on the expectations we set back in November. Second, we are entering 2023 with robust backlog and NTM revenue coverage for approximately 55%. Third, we have taken a balanced approach to setting guidance and believe we have adequately considered the risks and opportunities we see for the year. Fourth, we remain committed to deleveraging our balance sheet through disciplined capital allocation. Any acquisitions will be highly selective and supportive of my goal to reduce leverage below 4 times by the end of the year.

Next, operational execution remains front and center. I spent most of 2022 running both the Medical Group and our RTQA businesses in addition to my day job. This culminated in a wholesale rebranding of Mirion Medical, a sweeping reorganization and a significant improvement in our operational performance. With the onboarding of Mike Rossi, I now have the bandwidth to focus a greater degree of attention on our Industrial group. Finally, we have the best team in the industry and I am relentlessly focused on employee engagement and organizational health. I am confident that we are well positioned to have a great 2023 and look forward to updating you on our progress in May. Thanks again for your time and continued support and I will now pass things back to, Alex, to open up Q&A.

Alex Gaddy: Thank you, Tom. That concludes our formal comments for today. I will turn it back over to the Operator for question-and-answer session.

Operator: Thank you. Our first question comes from Andy with Citigroup. Please go ahead.

Andy Kaplowitz: Good morning, everyone.

Tom Logan: Hey, Andy.

Brian Schopfer: Hi, Andy.

Andy Kaplowitz: So your Medical related growth continued to accelerate over the last two quarters of 2022. I know you talked about strength in all of your major Medical businesses and I know you are forecasting mid-single-digit growth in 2023, you talked about demand normalization and tough comps. You have two of the three Medical businesses project to be up high-single digits, I think dosimetry is up mid-single-digit. So you are just being conservative on the overall segment, especially given the new Instadose rollout or are you seeing any slowing in any of your Medical businesses and that’s why you have got lower growth model?

Tom Logan: Yeah. Two things, Andy. Firstly, on the dosimetry business, historically that is a slow growing market. With the advent of Instadose, we believe that over the last number of years, we have been able to grow at a nominally higher rate than the market overall, but the growth rate there is inherently more conservative than what we will find in both — in either RTQA or in nuclear medicine. The other important thing to note is that we just were lapping a barnburner of a year this year in both of the RTQA and nuclear medicine segments. And while market dynamics continue to be very favorable and our outlook is positive, I think, we are just being measured in terms of how we are forecasting growth.

Andy Kaplowitz: Very helpful, Tom. And I think we understand that you will have significant order growth in Q4 in nuclear and defense, but you mentioned a clear pipeline of incremental newbuild in nuclear orders. So you think your nuclear business in terms of orders reaccelerate from here and then I know you are expecting more defense related orders, you mentioned the elongated order cycle for these types of orders, do you see them getting over the finish line in 2023?

Tom Logan: Yeah. Firstly, on the Nuclear power market, if you look at our order intake for the year, clearly we are seeing an acceleration of demand overall and that’s broadly reflective of the trends that we have talked about on numerous occasions. Principally noting the very high degree of government and popular support for nuclear power as an important solution to a variety of energy problems. And second — secondly the elevated price of electrical pricing, which is principally driven by gas pricing overall. Our view is that that strength continues, we do generally believe there is a lag effect between secular market changes within the Nuclear industry and in the downstream impact on our business and so we are hopeful that as the industry overall continues to gain momentum and gain health, that we will see that continue.

It’s important to note that our installed base is about three quarters of our nuclear power-related revenue, which is — as you have seen in the presentation constituted about 35% of our total revenue last year. So looking at the installed base is far and away the most important lens through which to evaluate the overall nuclear market and as noted those trends are favorable. But on the newbuild side, we continue to see significant activity in terms of the pipeline of projects that we are engaged with and we expect to see a broad based acceleration in utility scale developments continuing over the next decade or more. On the defense side, we continue to note that the degree of engagement, that we have with the 19 NATO militaries, NATO armed forces that we support, continues to be high, as it does with other supranational agencies and government departments.

We have noted that in general with government contracted business, that post-COVID order cycle times have lengthened. We continue to remain bullish about our prospects to see significant order intake here. But to be clear, we have been very measured, very conservative about how we have projected that for the year.

Larry Kingsley: Yeah. The other thing, Andy, just to give you some context on Nuclear power, if you take out some of our larger orders, so let’s say, above, call it, $5 million, we are on an as reported basis you are kind of mid-teens on the order growth, so if you adjust that for ex-FX, sorry, where we are kind of more in the 20% range. So the under — I think the point is, the underlying — there’s some noise with some of the bigger orders throughout the year, but the underlying business clearly continues to be healthy.

Andy Kaplowitz: That’s helpful guys. And then, lastly, could you go over the — again the margin headwinds in 2023 for Industrial and Medical. Obviously, you are forecasting lower than average incrementals for 2023. How much impact or the mix issues in Industrial expect to have on your business and I think even if we exclude the inorganic headwinds, you weren’t forecasting that sort of normalized 50% plus incrementals from Medical. So what else is holding you back there, maybe your assumptions around price versus cost and supply chain would be helpful?

Brian Schopfer: Maybe I will take that. So, first off, I mean, we are assuming in the guide basically price cost, so price versus inflation to be neutral. So I think we are going to work super hard to make sure that we get — we do get some benefit there. But right now where we are sitting, we are saying price cost neutral. The other thing we are seeing in the first half is, we have a bit of one of our businesses that will improve throughout the year and it’s more about volume and just the product mix and it’s really timing related. We have very good visibility into this business. It’s just a little bit weaker in the first half than what we would have liked and it’s just about how the factors are going to be loaded through the year.

So I think we have good confidence, and the other thing, I would say, Andy is, we were almost 10% higher in backlog coverage this year versus where we sat at this time last year. I think that gives us just a lot of confidence in the visibility we have thinking about 2023.

Tom Logan: Yeah. And by that, when Brian says 10% higher, it means 10 points. So it’s — yeah, essentially taking us up from mid 40s coverage into the mid-50s. So it is a significant increase.

Andy Kaplowitz: Appreciate it guys.

Operator: Our very next question comes from Joe Ritchie with Goldman Sachs. Please go ahead.

Joe Ritchie: Great. Thank you. Good morning, everyone.

Tom Logan: Hey, Joe.

Brian Schopfer: Hey, Joe.

Joe Ritchie: So maybe just tackling the visibility question for the guidance — the organic growth guide for the year. So typically like backlog coverage of 55%, how does that compare to normal and then as you kind of think about the swing factors then for 2023, Tom, what do you think is kind of like the key swing factors to see like, whether organic growth could maybe exceed the guidance that you have given for this year?

Tom Logan: Yeah. So a couple of things, Joe. Firstly, as noted, I think, our backlog coverage coming into 2022 was about 10 points lower than we are sitting now. So on a percentage increase standpoint, that is a substantial increase overall in the NTM coverage. And the good news too is that, if you look at the average order size, it is smaller and so the quality of the coverage generally is better. If you look at the guidance sensitivity, I think, we have a page in the deck. I think it’s page 11, that just kind of highlight some of the key issues and opportunities that we see out there and some upside potential drivers would include continuing growth and momentum, essentially the flywheel effect within the nuclear power market, continued improvements and supply chain volatility and labor market tightness.

The potential optionality associated with larger civil defense and military orders that are not currently reflected in the guide. We have — I think we have been very clear that our top focus is on operational execution this year and we think we see some potential blue sky as it relates to cost reduction efforts and improvements in our overall pricing heuristics. And then, finally, as Brian noted, the overall currency environment is a little bit more favorable for us this year. On the downside, the world continues to be a little bit of a volatile place and so one of the key risks obviously is devolution in geopolitical dynamics. Secondly, the extent to which inflation worsens. We saw CPI print this morning, that was a little bit worse than consensus, but on the other hand reflecting a continued decline overall in inflation trends.

If we do see any kind of unanticipated tightness in supply chain changes to the macro picture or further degradation in currency or interest rate, obviously, all of those things could be game changers. But as noted and I think emphasized, we have tried to be very balanced and measured and in our forecast approach to this year in order to accommodate these and do so with confidence.

Joe Ritchie: Yeah. That’s super helpful, Tom. And I guess just thinking about the cadence for the year as well, maybe a question for Brian. I know that you guys have tried to be thoughtful about the guidance, just want to make sure that we get just seasonality as well. It seems like you have got some really nice visibility into the first half of the year and so is the expectation then that in the first half of the year, you can see EBITDA growth at least at the mid-point, maybe towards the higher end of the range — the growth range for the year? So any commentary around that would be helpful?

Brian Schopfer: Yeah. I think, Joe, what I said during my prepared remarks is, we have a bit of a headwind on the margin Industrial side in the first half, because of some of the mix issues that I noted. And then — but we have good visibility and expect those will — well, they will clear up going into the third quarter and fourth quarter. So I think the first quarter obviously is a — the easier comp on the Medical side, so I expect that to come to fruition. I think the Industrial guys had a great fourth quarter. So I expect kind of that to be pretty decent in the first half and pick up into the back half. I think margins — the margin cadence will be a little lighter than you — then we would hope in the first half, but better — much better in the second half and I think the visibility to both some of the cost out program, some of the pricing continuing to flow through the P&L.

Our ability to get after the supply chain, et cetera give us confidence there. And like I said, our backlog coverage continues to be to be very good. But we are a little bit of a mix headwind kind of in the first half that we just need to overcome.

Joe Ritchie: Got it. And Brian, just to be clear on pricing, are you guys expecting to be price cost positive this year?

Brian Schopfer: Neutral is what’s in the guide. So that’s upside if we can do better and we continue to be very aggressive in the market on pricing. But as we saw this year, it takes a bit of time to kind of flow into the P&L. I will just note one more time, Joe, for you, we did end the fourth quarter at 5%, which is what we had expected going back a couple of quarters. So the team is executing well on the pricing. It just takes some time to flow through the P&L.

Joe Ritchie: Yeah. That makes sense. Last one for me. Tom, you mentioned on improving operating environment in Industrial. Can you just elaborate on what you are seeing and how it’s impacting your business? It sounds like supply chain has gotten at least modestly better, just wanted to get some thoughts there?

Tom Logan: Yeah. So few things, Joe. Firstly, to your point, yeah, supply chain dynamics in our view are never going to be what they were pre-pandemic, but they certainly seem to be improving and the number of kind of episodic issues that we have seems to be on the decline overall. But more broadly, if we look at the drivers of performance there, again a lot of it is driven by the kind of order intake experience we had last year and the health of the market segments that we are selling into. Our business model hasn’t changed and if you look at the fall through at the margin level to the bottomline, that is inarguably the most important dynamic in terms of overall operating performance for the business. So to the degree that we can be price cost neutral or better, to the degree that we can be disciplined about factory overhead costs and OpEx, then volumetric increases are going to be reflected in strong performance overall.

So it really is a function of more than anything else just executing well. And I kind of referred to the fact that, it’s important to remember last year was our public debut and so it was very consuming to become a public company to deal with all of the related issues, as — again in our debut year. But on top of that, given the fact that we were really creating coherence within our Medical group, it consumed an enormous amount of my time to focus on Medical and specifically on our radiation therapy business overall. With the hiring of Mike Rossi, President of the Medical Group, it gives me a more normalized bandwidth to be able to support and assist and focus on execution across the entire enterprise and I expect that will have some beneficial impact on our operating performance for the year.

Joe Ritchie: Great to hear. Thank you.

Operator: Our next question comes from Chris Moore with CJS Securities. Please go ahead.

Chris Moore: Hey. Good morning, guys. Thanks for taking a couple of questions. So maybe just back to price for a second, so price cost basically neutral, if you are looking at 4% to 7% organic growth. So from a price volume standpoint, most of the — most of that growth is in price, is that fair?

Tom Logan: Yeah. It’s — I mean just because of our ramps and it’s actually pretty balanced when you do the math out on price volume. So I think that’s how we are thinking about it.

Chris Moore: Got it. Tom, you called out SMR here and

Tom Logan: But.

Chris Moore: Go ahead.

Tom Logan: Chris, it’s — there is a slide, I think, it’s 16, that actually shows you the range between and how we split it between volume and price, you would see it’s pretty balanced, little more volume on the high end of the range, balanced at the low end.

Chris Moore: Perfect. Thank you. Called that SMR as potential big opportunity, just curious from a sales cycle and development cycle perspective is that meaningfully different than what you see on the traditional utility?

Tom Logan: It is in the sense that there are lot of new players and there is a substantial amount of government funding that’s coming into the space. And just to put it into context, why we are specifically excited about the SMR market? Understand, that firstly, if you look at total installed nuclear capacity globally, today there are roughly 450 operating utility scale nuclear power plants with about 380 gigawatts or 390 gigawatts of total capacity. If you look at North America alone and look at the decommissioning coal — profile for coal plants, there you have about 450 gigawatts of scheduled decommissioning over the next 15 years or so, that is the core target market for the SMR space. And candidly, I think, as we have noted on prior calls, this is a market that’s moving faster than previously it had.

There seems to be an acceleration of efforts, more tangible efforts and as noted in the prepared remarks, we have booked backlog on several of these projects, but the key right now again as the strategic engagement with the major sponsors here to work hard and try and get our industry leading solutions specked into these power plants.

Chris Moore: Okay. Got it. Very helpful. Mostly others have been covered. I will leave it there. I appreciate it guys.

Tom Logan: Chris, thank you.

Operator: There are no further questions at this time. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation and have a nice day.