Rockwell Automation, Inc. (ROK) Earnings Call Transcript & Summary

Thank you, and good evening. I'm Blake Moret, Chairman of the Rockwell Automation Board. It is my pleasure to welcome you to our 2021 Annual Meeting of Shareowners. I'm joined today on the call by Steve Etzel, our Senior Vice President and Chief Financial Officer; and Becky House, our Senior Vice President, Chief People and Legal Officer and Secretary. Our Board members are present on the call. I would like to begin by introducing the 5 nominees for election to our Board of Directors: William Gipson, William is the retired President Enterprise Packaging Transformation and Chief Diversity and Inclusion Officer of Procter & Gamble. William joined our Board in November and serves on the Audit and Technology committees; Phillip Holloman. Phillip is the retired President and Chief Operating Officer of Cintas Corporation. He has served on our Board since 2013 and is a member of the Compensation and Talent Management and Board Composition and Corporate Governance committees; Steve Kalmanson. Steve is the retired Executive Vice President of Kimberly-Clark Corporation. He has served on our Board since 2011 and as Chair of the Board Composition and Corporate Governance Committee and a member of the Compensation and Talent Management Committee; Larry Kingsley. Larry is the former Chairman and Chief Executive Officer of Pall Corporation. He has served on our Board since 2013 and is Chair of the Technology Committee and a member of the Board Composition and Corporate Governance Committee; and Lisa Payne. Lisa is the former Vice Chairman and Chief Financial Officer of Taubman Centers. She has served on our Board since 2015 and is Chair of the Compensation and Talent Management Committee and a member of the Board Composition and Corporate Governance Committee. I would also like to introduce the other members of the Board: Jim Keane. Jim is the President and Chief Executive Officer of Steelcase; Pam Murphy. Pam is CEO of Imperva; Don Parfet. Don as Managing Director of Apjohn Group and the General Partner of Apjohn Ventures Fund; Tom Rosamilia. Tom is unable to attend. Tom is Senior Vice President of IBM Systems and Chairman for IBM North America; and Patty Watson. Patty is President, Enterprise Collaboration of Intrado. I would now like to introduce the representatives of Deloitte & Touche, our independent audit firm. Present on the call, Eric [Koyu], Lead Client Service Partner, and Brett [Prio], Audit Senior Manager. This is the first year we are holding the annual meeting in a virtual format. We're doing this due to the public health impact of the COVID-19 pandemic and to support the health and well-being of our shareowners, employees and community. The agenda for today's meeting includes a brief report on the company's business activities and a presentation of the proposals described in this year's proxy statement, followed by a question-and-answer session. And keeping with the virtual approach to this meeting, it is now shortly after 5:30 p.m. Central Time on February 2, and the annual meeting will now come to order. Again, welcome, everyone, and thank you for joining us. Let me start with a report on the company's business activities. Rockwell Automation is a pure-play company, and we're taking manufacturing to a whole new level. We're well positioned to provide resilience, agility and sustainability for our customers as IT and operational technology converge and this is happening across discrete, hybrid and process industry segments. We're also very proud of our total shareowner return, and we remain intensely focused on creating value. We go to market with 3 brands: our Allen-Bradley product brand, our FactoryTalk software brand and our Lifecycle IQ Services. At the foundation of what we do is a strong and vibrant culture. The tenets of that culture includes strengthening our commitment to integrity, diversity and inclusion. Being willing to compare ourselves to the very best other choices that our various stakeholders have, whether they be customers, employees or shareowners. An increased speed of decision-making and a steady stream of fresh ideas from within existing employees and also through acquisitions and new hires. Our approach to bringing the connected enterprise to life involves understanding our customers' best opportunities for productivity and being able to describe our value in their language, combining technology and domain expertise to deliver positive business outcomes to help customers get the return on the investment that they've made. And simplification because simplification drives productivity, both for us as well as for our customers. Software is an area of keen focus for us as increasingly, that's a big part of the value proposition. Our design suite is a set of tools that's ever-expanding and helps us provide value for our core automation products; operations suite to make sure that our customers are getting the most from their assets; maintenance suite to reduce meantime between failure and to increase OEE; and innovation suite, which together with PTC is providing new value and creative ways for our customers. A portion of our software is delivered through the cloud and one of our most exciting recent acquisitions is Fix, providing Software-as-a-Service for asset management. Fix spans the traditional divide between manually entered key stroke data and real-time data coming off of smart products such as the ones we sell. It provides a whole new level of productivity on top of core automation processes. Also important to our differentiation is the best partner ecosystem in the business, from electrical distributors that provide significant value for our customers around the world and especially in the Americas, systems integrators that provide domain expertise and specific applications around the world, machine builders who are using our products and applying them to their own machinery and other partners that create an ecosystem that's second for none -- second to none in this business. Altogether, nobody is better positioned to bring information technology and plant floor technology together to provide value for our customers. Before we begin the formal business portion of the meeting, I would like to review the rules of conduct for the meeting, which are posted on the meeting site for reference: first, the only business matters to be conducted at the meeting are the matters set forth in the notice of meeting and proxy statement for this meeting; second, we welcome questions from shareowners. If you are a shareowner and want to ask a question, you can do so by typing your question in the Ask A Question text box on the meeting site. We'll try to answer all questions during the meeting that are relevant to the business of the meeting and any relevant questions that are not answered during the meeting will be posted and answered on our Investor Relations website shortly after the meeting; third, if you've already voted on the proposals, you do not need to vote at this meeting. If you wish to change your vote or you have not voted, you can vote online during the meeting until the polls close; finally, recording of the meeting is prohibited. Ms. House, our Secretary, has informed me that the notice requirements for this meeting have been satisfied. We have received proxies representing about 85% of our outstanding stock, so we have a quorum. A representative of Broadridge Financial Solutions is present and will act as the independent vote tabulator. We will now start the business portion of the meeting. As a reminder, if you would like to ask a question or make a comment, please use the question box on the meeting site. We will address any relevant comments on the proposals after all proposals have been presented. This year, we asked our shareowners to consider and vote on 3 proposals. Ms. House, what is the first proposal?

The first proposal is to elect 4 directors to hold office until the 2024 Annual Meeting of Shareowners and 1 director to hold office until the 2023 Annual Meeting of Shareowners.

All nominees for election to our Board are present. There is a brief biography of each nominee in our proxy statement for this meeting.

The next proposal is to approve the Audit Committee's selection of Deloitte & Touche as our independent registered public accounting firm for the current fiscal year.

Representatives of Deloitte & Touche are present.