Snap-on Incorporated (SNA) Earnings Call Transcript & Summary

Good morning, and welcome to Snap-on Incorporated 2023 Annual Meeting of Shareholders. My name is Richard Miller. I am Vice President, General Counsel and Secretary of Snap-on and I will serve as today's parliamentarian. At this time, I would like to ask everybody to please turn off or silence your cell phones. The meeting is being webcast and recorded, and a recording of it will be available at snapon.com shortly following the meeting. I now call the 2023 Annual Meeting of Snap-on shareholders to order. We have made the order of business and rules of order available to everyone, and I would like to request that you please abide by them. It is now 10:05 a.m. on April 27, 2023, and the polls are officially open. If anyone has not yet voted and would like to do so, our inspectors of election, Abby Cowart and Fred Papenmeier from Computershare are here in the back of the room and can record your vote. Attending today's meeting are the following members of the Board of Directors. I would ask that you please stand when I call your name. David Adams, retired Chairman of the Board and Chief Executive Officer of Curtiss-Wright Corporation; Karen Daniel, Retired Division President and Chief Financial Officer of Black & Veatch Corporation; Ruth Ann Gillis, retired Executive Vice President and Chief Administrative Officer of Exelon Corporation; James Holden, Snap-on's Lead Director and retired President and Chief Executive Officer of DaimlerChrysler Corporation; Nathan Jones, retired President, Worldwide Commercial and Consumer Equipment Division of Deere & Company; Henry Knueppel, retired Chairman of the Board and Chief Executive Officer of Regal Beloit Corporation; Dudley Lehman, retired Group President of Kimberly-Clark Corporation; Gregg Sherrill, retired Chairman of the Board and former Chief Executive Officer of Tenneco Inc.; and Nick Pinchuk, Chairman of the Board, President and Chief Executive Officer of Snap-on. Nick will present an update on the performance of your company at the conclusion of the official business. Also here today are James Stewart and Owen McCormick, representing our auditors, Deloitte & Touche LLP, and they will be available to answer questions after the meeting. We have an affidavit that notice of the meeting was mailed as required, and it will be incorporated into the company's meeting minutes. Since it appears that all shareholders have had the opportunity to vote, will the inspectors of election please confirm that all ballots have been counted. Great. Thank you very much. It is now 10:07 a.m., and the polls are officially closed. 53,122,822 shares of common stock, each having 1 vote on each proposal are entitled to vote at this meeting. I've been advised by the inspectors of election that we have a quorum with 89% of all shares outstanding at the meeting. All voting results are stated as a percentage of the stock represented unless otherwise stated. Today, we have 4 items on the agenda. Our first is the election of directors. The Board has nominated the following candidates to serve until the 2024 Annual Meeting: David C. Adams, Director since 2016; Karen L. Daniel, Director since 2005; Ruth Ann M. Gillis, Director since 2014; James P. Holden, Director since 2007; Henry W. Knueppel, Director since 2019; Nathan J. Jones, Director since 2008; W. Dudley Lehman, Director since 2003; Nick Pinchuk, Director since 2007; Gregg M. Sherrill, Director said 2010; Donald J. Stebbins, Director since 2015. Each of the directors received votes in their favor of at least 77% of the shares represented, and therefore, each has been duly elected. The second item of business was the ratification of the selection of the Audit Committee of Deloitte & Touche as the company's auditors. 91% of the shares represented voted in favor of this proposal therefore, the Audit Committee selection of Deloitte & Touche has been ratified. The next item of business is the advisory vote to approve the compensation of Snap-on's named executive officers as presented in the proxy statement. 92% of the votes cast for approval of the compensation and therefore, the resolution is approved. The last item of business is the frequency on which the advisory vote on the compensation of directors is considered by the Board each year. 96% of votes cast supported continuing to hold that vote annually as recommended. This now completes the official business, and the meeting is now adjourned at 10:10 a.m. We will now have a short video, please watch. [Presentation]

The world moves forward, making lives better. Progress shaped by work. The work of days, the work of years. It's the work of the few., it's the work of the many. The work of the skills, the work of the serious, it's the work of makers and it's the work of fixers. We are Snap-on, and we are the people of that work. We are the wheelers of insight and experience forged by the decades, sharpened by the new, and guided by the work. We summon the future out of the present. We make the critical and the essential easier. The LN47 needle nose players, we actually purchased these because guys like me, once you've been banging on and wrenches all your life, your wrist get real weak. So you just kind of lose the grip in your hands and I have been struggling with that. These things actually require about 10% of the pressure to grab something that would require 100% of the pressure and that's the one thing that sold me on these. I didn't have to question the strength or the durability because it's Snap-on. We're heavy-duty diesel trucks. This is my favorite go-to 3/8 impacts for daily use of CT861 just because it's so compact, high power, you're getting them type places and it's got light. So see what you're working on. It's just all around amazing products. I've been working on cars since a very young age. I've been doing it professionally for about the last 10 years. There is a lot of data to monitor on vehicles these days, and Snap-on scan tools have just progressed as the data has -- it takes a lot of the guessing out of repairing the car. That just gives us the data that you need, right at your fingertips get cars in and out as quick as possible without come back, that's how we make our money time is money in this business. So any time that we can save, we're going to be able to make more money. We were working on Honda trying to take the crane fully bolt-off. Snap-on comes in every week. So they make sure that I'm up to date on anything I need. I said, "Hey, do you still have that socket you showed me last week. And you said yes, and let me go grab it, put it on the impact. That bolt came off within seconds. I bought it on the spot. Snap-on for an everyday mechanic is where you have to be, if you want quality tools, it got to stay in the snap-up. We are the bearers of pride and dignity. We mark the special and the committed. I sport my Snap-on stuff quite often. I'm proud to wear my Snap-on gear. It says who I am and the kind of work that I do. Snap-on tools has always been something you can carry on your chest proudly. And know when you walk into a shop that people will come to you and they'll tell you a story about their father, their grandfather who use Snap-on tools and what it meant to them. And that in itself carries immense pride for me. To be able to walk through any place and never have to one time say, we're almost as good as that. You never have it to say with Snap-on. You are the best with your competition. They shake in their boots when they see a good Snap-on guy, it's time for them to move, and go find another place to do business. And that doesn't bother me at all. Let them go. We greet the dawn and meet the dusk. We deliver dreams and we change lives. My stepdad worked for Snap-on in this route, and he begged me for almost a year. Just come work for me. You'll love it. And he said, "Just ride with me for 3 days." I loved every minute from time I woke up to the time I went home. In 2 years, at this point, I'm running a $1 million business. My phone rings anywhere from 6 a.m. to 6 p.m. The guys know that anytime they call or text me, I will respond to them. I walk into shops, and they're happy to see me. That's important to me. It's amazing to have that job where you can show up and have some fun and still make good money. So end of the day, I wouldn't change anything about it. It's the best decision I made for sure. We see the same customers over and over and over again -- so it's more intimate. You get to be somewhat of a confidante or a friend. I have customers that I've seen since day 1. It's going on 21 years. Second generation, of course, a couple of those. There is a shared trust in this relationship. It shows that you have a commitment to your customers when you show up, week in and week out. I catered my whole career in life to being able to open my own shop. It's a dream come true, honestly, Snap-on Credit was just amazing. They financed everything for me, and I was able to get everything I needed to open the shop. I never would have imagined that it would be where it's at right now, come to work every day and have fun and serve the community and it doesn't feel like a job. It just feels like my passion. I look forward to every day working here. In the end, when you can raise a family and live a nice lifestyle and have a lot of pride in what you do, it's really something -- you can't get that a lot of places. And I feel that Snap-on is the best product that a professional mechanic can spend his money on. I love selling the best tools. The world does move forward every day. It's progress. It's work. It's pride. It's dignity. It's dreams. It's lives. It's Snap-on. It's all of us and we are the people of that work.

Wow, the lights come up. Look, it's great to be back with everybody here. We are parts along during the COVID but each time we get together, I feel great about it. I hope you feel the same. I want to open this meeting officially by welcoming you to the 2023 Annual Meeting of Stakeholders. Snap-on, I hope you realize and I'm going to try to make the case to you in the next several minutes -- that Snap-on is a great company, unique and special. Founded now almost 103 years ago, more than 10 decades ago and found it on the timeless principle that we should have the respect for the pride and dignity of work and listed in an endeavor. Summoning the new out of the present, creating products and tools that make work easier for working men and women moving the world forward a cause that is as relevant today as it was all those 100 years ago. And I'm here to tell you that, first of all, you are all part of this. Everybody in this room contributes in some way to the strength that is Snap-on. And what I want to tell you why I'm here. The principal purpose is that Snap-on, the Snap-on company, you're a company, our company has never ever, ever been stronger than it is today. You can count on that. Part of the reason why we're where we are because we have come through some difficult times. I remember the great financial recession and, of course, the recent existential threat we call the COVID. And one of the reasons is we have a great board; imminent, capable, steadfast, standing firm among all these difficulties and one of the reasons why we've been so resilient in this is their leadership and their guidance and their support. So, I ask you to once again give these ladies and gentlemen, a round of applause. I'm going to tell you, ladies and gentlemen, that you've heard me say this before but the people at Snap-on feel privileged to have all of you on our board, and I mean it. I love that video. You might wonder why we had the tumble weed and the visages from Monument Valley, it's not because we love those visages so much. But we have that as part of our SFC last year, Snap-on Franchise Conference in Dallas, Texas. And you know what it struck us that, boy, the spirit of the West is exactly where the idea of moving out and making a life of your own from nothing is what Snap-on people do when they ride those bands. That's why we did this. I kind of felt that I should open the -- my remarks today by just simply quoting the song, "yippee yi yo, yippee ki yay, goes riders in the sky." It was that song that came up but it's not the images. It's the words from the franchisees and the words that open it, that I think says so much. The world moves forward, progress shaped by work. It's the work of days. It's the work of years. It's the work of the few, it's the work of the many. It's the work of the skills, skills, it's the work of the serious. It's the work of the makers and it's the work of the fixers. We are Snap-on, and we are the people of that work. When Snap-on people hear these words, they recognize that they're truth of it. They recognize that the video rings with truth and drips with emotion and it could not be done by anybody we would hire to do this. And so like all our videos, this video was written and produced and directed by Snap-on people, and I'd like us to recognize him here. Two of them are right here. Sam Bottum, our Chief Marketing Officer; and [ Bridget Carea ]. She's right back there sitting next to Andy. Stand up. Let's give them a round of applause. I've been counseled by my attorneys to make you aware of the way in which you -- the lens to which you should look at my remarks today and so I have to show this thing, it's called a kind of a cautionary statements. I supposed to read it and understand and figure out how to view my remarks. Here it is. Okay. That's enough. All right. I'm going to start out by -- one of the things we've always started out, we started every meeting at Snap-on point with the idea of this poster, we call it the declaration of who we are. One of the most important things of a corporation is to know who you are and we know who we are. This poster is in every collective, every common meeting room in Snap-on, and it's in most individual rooms. And it says things about us. It says our mission. We make the most valued productivity solutions in the world. It talks about our beliefs, visions, and value. We believe in safety. We believe in connecting with the customer. We believe in quality. We believe in innovation. Summoning the new out of this present, and we believe in getting up every day and figuring out how to do our jobs better and serve our customers better and move the world forward more effectively. We call it rapid continuous improvement. You're going to hear those words again, today. We have certain values. And these are values, they're not particularly unique. There are kind of values that your mother should have thought even and they're out of natural law for society and human beings. The idea that you tell the truth, you value integrity, you value teamwork, you respect people and you listen to them. It's nothing special, but we want to put it up there so people know that this is how we live our lives. It's how everybody expects to live their lives. And then we have a vision of ourselves. And the vision of ourselves is simply to be the partner of choice for everybody we interact with. This is who we are and it's at the core of our business. Now 103 years ago, it sounds like a lot. No, Aldo, I was not here when it started. Yes, I know you're thinking that, but no. It wasn't the situation. But we say it started with a spark and the spark was an idea and yes it was. The idea was, and this was a time about 1920 when the auto industry was just getting started, and the idea was to revolutionize tool sets. And what it was, was take 5 handles of different configurations; an ellipse, a teevee, a crank and put them together with sockets of 10 different dimensions and fashion them so they Snap-on interchangeably. We said those 5 handles do the work of 50 tools, and it did. And it was this innovation that revolutionized tool sets all over this country and that tradition of innovation has been handed down to us. But as is depicted in this, and you've heard me say this many times over, but I think it's something important to start every conference here is that there were other ideas. Some of the other founders got other ideas that said we should assume the normal way to sell tools that sells through a distributor, but to go right into the garage and talk to the mechanic, and lay those tools out on greenfield as if they were as precious as surgeon knives, treating them like the jewels that they really are. Implying that if the mechanic used these tools, even declare to the world he was doing something special, perhaps as special as a surgeon, and the idea that the Snap-on brand, your name, the company you're associated with is the outward sign of pride and dignity that working men and women take in their professional lives is at the core of what we do. It was the time of the founders. And during the founder's time, there were 4 founders. And one of the great things about Snap-on, contemporary Snap-on is we have living links to the founders. The man who had the original idea, the original engineer who had the "5 do the work of 50" idea, Joe Johnson, we have Greg and Kathy Johnson here with us, Greg, the grandson of Joe Johnson, and he actually was not only linked to the founder. He worked with us here at Snap-on, he was an associate for almost 30 years being the Director of Financial Audit and the VP and Controller. And then the first President of Snap-on was Stanton Palmer and we have Patsy Callahan and her son, Andy, and his wife crystal here with us. She is the granddaughter of Stan Palmer. Living links to the founder. Please, ladies and gentlemen, please stand up. Let's give them a round of applause. It's not everybody who has... Actually... Actually. Thank you for coming because it's not common for companies, particularly public companies of this day, to have living links to their founders, to remind us of where we can from. Thank you for doing that. Every time you come here, you help us remember where we came from, and we appreciate it. It did start with a spark and the spark was an idea. And the idea forged a dream and that dream was the Snap-on company and that dream shaped lives and reached across the country and the world. And some of the lives it shaped, we now call the makers and the fixers. These are the people that historians have said, have led or have raised and supported our country to ascendancy. Certainly, they are the people who got us through the great World War II, creating the industrial substrate that allowed us to win the one war we cannot afford to lose. And more recently, they stood their post firm, keeping our society well from disintegrating while we engaged and defeated the COVID, the makers and fixes, and we celebrate them. We celebrate our respect for the pride and dignity that they hold in their work. We enable them to accomplish the critical task that are so essential for our society. And we do that as the video sort of said, because we have insight and experience into what we do. And this insight has been forged over decades. You can see it here. We've been turning out these hand tools for decades and our franchisees and our direct sales were way back to the man you saw standing next to the greenfield has been out there in the garages working with people, forged over decades, but it's also been sharpened by the new. We employ incredibly new things like big data, associated with our intelligent diagnostics, or the idea of the precision that we employ in our torque wrenches that enables all the autonomy we start to see in cars in the precision and efficiency we see in airplanes, and wind towers, and oil and gas platforms. And all of that is because we've been guided by the work. Unlike almost any other company, we do not survey our customers, we don't survey them. We go into the workplace like the original founder-- like the founders decided we should and we observe the work, and we figure out how to make it easy, how to make the task easier. We see the task. We see the ones that are difficult and we come out with tools that will make them easier. And we do that, whether it's in a garage with an aligner or up 300 feet in a wind tower. And all of this has that insight and experience has created some pretty good strength for us. All these strengths have allowed us, over the years to have a characteristic which people talk about now on earnings calls and so on, we would say resilience. And so I want to show you a demonstration of Snap-on resilience in the numbers. Let's look up 4 years back, which includes the COVID. Let's look at sales. For example, before the COVID in 2019, sales were $3.73 billion. And then during the COVID, they came down some to $3.59 billion. And then after the COVID 2021, boom out in a V shape recovery to $4.25 billion. And this past year, $4 billion and $490 million, almost $4.5 billion. This is resillience. You can see it in the operating income margin. This is the percent of sales that goes to profit, pretax profit. By the way, just to go back before the COVID, it at 19.2%. Then it went to 17.6% because COVID was a tough time, and everybody took a step back. And then last year, 2021, it was 20%. And the year after that, last year, 2022, it was 20.9%. That means it was 90 basis points above 2021, and it was 120 basis points, 170 basis points above the pre-pandemic levels, and this is in an orb in which people celebrate 10 basis points improvement, resilience indeed. And if you look at the earnings per share, which includes the credit company and also takes out for taxes, you go all the way back to 2019 before the pre-pandemic level is $12.41. And it went to $11.44. In 2021, it was $14.92 and it was $16.82 at '22. And that $16.82 was up 12.7% year-over-year and a 35.5% over just 3 years ago. Resilience indeed. And the people who helped us, everyone here in this room made that possible, but I'd like to recognize now, some special people who played a major role in that resilience, and that is our management team. First, I want to introduce, well, I want to introduce from President Biden's hometown, Scranton, Pennsylvania, our Chief Financial Officer and my friend, Mr. Aldo Pagliari; from Bengal, India and Lake Forest, Illinois, our Chief Development Officer, Mr. Anup Banerjee; from the Jersey side of Philadelphia and long-suffering fan and now recently rewarded fan of the Philadelphia Eagles, Mr. Tom Ward, President of RS&I. And then from parts unknown, sometimes referred to as Iowa, we have the President of the Tools Group, Mr. Tim Chambers. From the vast country of Spain, the President of our Commercial Group, Mr. Jesus Arregui. And then the newly appointed President of our Repair Systems Business, born in Milwaukee, Wisconsin, and from these regions and a holder of basketball records, I'll let you find out what it was for Marquette University, Mr. John Wolf. And now for those of you who are last year might remember a special event last year, we had someone beam in from quarantine in Shanghai, and this guy was in quarantine 17x and a total during the COVID, ready for this, buckle up. 195 days. Think about that. In prison for 195 days. This is a place you'd go to a hotel and they lock the door and put your food underneath the door and sheets came every 7 days. Pretty difficult. So in the tradition of something called SNL, I want to say, we have here, not on Zoom today. Here at the idea forge. We have not on Zoom today but live from the forge, we have Mr. James Ng, the President of Asia Pacific operations. Now if you step back and you know our history, you would believe actually, as we believed that we were not going to be disrupted by the COVID or the great financial recession because Snap-on, if you've attended this meeting for a long time, you can see that Snap-on has not only resilience, but it generally has a great opportunity moving forward, great momentum. Look at this chart. This is a trend of sales and operating income. You look at the sales way back to -- we go back to 2011, $2.85 billion; $2.94 billion, $3.06 billion, $3.28 billion, $3.35 billion, $3.43 billion, $3.69 billion, $3.74 billion, $3.73 billion and then the aforementioned $3.59 billion, $4.25 billion, and $4.49 billion. And if you look at the operating income back to 2009, I remember when the operating income in 2005, I think it was 6.5%. So when it was way up in 2011, but 14.5% and 15.2% and 15.8%, then 16.6% and 18.1%, then 19.3%, 19.3%, 19.4%, 19.2%. And again, the aforementioned 17.6% and 20.0% and 20.9%. These are quite records. They show that if you looked at this, you would have known that we were going to come out of the COVID with a V. Well, there are people who contributed to that. Some of our leaders, we like to say we have a legacy from our retirees and we have some representatives of former presidents. Everybody who knows me knows that I am the fortunate beneficiary of the work of greater predecessors. And relations and some of them are here today. So first of all, I'd like to introduce the daughter of our seventh President, Norm Lutz, who brought us to the New York Stock Exchange. He was the 7th President. She comes here every year almost Susan Lutz-Kenyon and her husband, Bill. Stand up, please. Thanks for joining us again. And now a man of special importance to me, someone who gave us so much gave us so much. He was the guy who reconnected us with the community and our retirees. He gave us who we are. He said, you had to know who we are, and he was right. And he coined the phrase, rapid continuous improvement. And of course, I'm talking about my former boss, my current counselor, and my ongoing friend, Mr. Jack Duane Michaels right here. The legend returns. And okay, you can look at that from the pretax point of view, but if you want to look at the after-tax and you want to look at EPS, you can see the numbers back to 2011, $4.71. Then $5.20 and $5.93, then $7.14 and $8.10, and $9.20, and $9.52, and $11.87 and the aforementioned $12.41, $11.44, $14.92 and $16.82. And we have other people who have worked on that. And we have 2 more recent alumni. I want to say alumni, but actually retirees who have come back to us. Our former President of the Tools Group, my old friend, Mr. Tom Kassouf; our former General Counsel, Mr. I am sure, Mr. Irwin Shur, please stand up, gentlemen. Thank you all. Welcome back. And all of this you might ask; how did we survive the COVID -- it's kind of a tough time. Everybody is kind of worried. People are asking and sheltering and distancing and eventually vaccinating. But my secret, I never got it. And my secret is, I was always worried because of COVID, you have symptoms of cough and you lose your taste, you lose your taste. So I test it every day at least once -- this got me through it. Sometimes I had to test 4 or 5 times a day. I hear it's back. All clear. Okay, I didn't take a bigger piece. I almost did. But all of this comes together to reward our shareholders and the reward of the shareholders with our dividends and the realm of the dividends or the string of dividends back to 2011 at $1.30, $1.40, $1.58, $1.85, $2.20, $2.54, $2.95, $3.93, $4.47, $5.20 and $5.11 and $5.88, up 14.1%. And this dividend is one of the greatest things in terms of testimony to our resilience because you see we started paying dividends in 1939, and we paid the dividend every quarter since that day but we have paid a dividend every quarter since that day, and we have never ever reduced it. This is among the longest record of undisrupted, unreduced dividends on the New York Stock Exchange. So people ask me, investors ask me all the time about what's your dividend policy? And I don't give any policy, but I say, "Well, how would you feel for the CEO? No one had ever reduced the dividend or ended it for -- since 1939. I think you can figure how I stand on that. I don't want to be remembered that the guy who did reduce it or interrupted it." And the people who have helped us in this regard, we have some more retirees that I'd like to introduce you to because they are the people who both benefit from this and have helped us through these times back here. I have Sharon Zak, 44 years with this and her husband Jim. Stand up, please. And then I have -- and her stunning daughter work for Snap-on, right. They work for -- Christie and Kurt. One works in the credit company; one works in the operating company. I have Craig Govekar, over, who has worked for diagnostics and a number of places and has had, I think, 43 years with Snap-on and has 38 patents for the company. Stand up, please. Craig. And now I introduce Ms. Charlotte Berges, who was with us 36 years and was an HR administrator on our Eastern region. Charlotte, please stand up. But I had a special relationship with Charlotte. When I came to Snap-on I had been in other company, Ford Motor Company and has been at United Technologies. Karri, I have been an agent for a long time. So you show up here. And I'm traveling around the country and I go to the east, and I meet Charlotte. And we start talking and I realize that we have the same accent. And she lived in South Troy, New York, which is where I lived. And as we started talking longer, I realized that when I was young, 7 or 8 or let's say, 10 or 11 -- and I was walking with my baseball glove and my baseball bat down to the local diamond, I passed her family's house. And I knew some of her siblings. But I remember her as a toddler. What a great privilege it is to work with the company and realize you're working with somebody that you saw when Micky Mantle was still your idol. Really, this is a great privilege. So I feel pretty good about that. Thank you for being here, Charlotte. Okay. Let's give her one more round of applause. Just for me. Okay. Well, those are the sort of 2022 and trend numbers. Now I'd like to talk about the way forward. And we have something called runways for growth and runways for improvement. But before I talk about them, I speak about them, I want to tell you that at Snap-on. We believe in power of place. And if you were at the groundbreaking, out here with this building at our 100th anniversary, you would see that I said we have great respect and admiration and appreciation for the people of Kenosha, and we have always been supported by the people who lead the communities here. And we have some of the community leaders here. We have John Antaramian, the mayor. We have John Morrissey, the City Administrator. We have Samantha Kerkman, the county executive and we have my old friend, Tim Mahome, one of the community leaders. Let's give them a round of applause. Thank you for all your support. It means so much to us. A company cannot exist without the support of its community and choosing your ground really makes a difference, and we have benefited from having chosen Conoco all those years ago. Thanks so much. Okay. So we have something called runways for improvement. We call it Snap-on value creation. It actually is right on or who we are. These are our beliefs. We believe in safety. And why do we believe in safety. We're a public company. If you keep your people safe, you get more productivity, but that's the right thing to do. You don't want people to get hurt when they work for you and also small detail, if you make things for working men and women, if you can't keep your own people safe, what does that say about your capability, right? It doesn't say much. So we're very proud because we've tried to work on this. And so we're proud of and satisfied about our safety, I should say. We'd like to see it better. But certainly, it's not too bad because over the last 15 years, since 15 years ago, Snap-on people are 90% less likely to have an accident than they were all at years ago. And every year, we try to make it better. Last year, there were 84 of our 103 sites who had no lost time accidents. -- safety, we believe in safety. We believe in quality. There's a lot of ways to measure quality. But we like to get the response of our customers. So we have a couple of quotes up here. Gary Moriera on AutoTech from Jersey, and he says, "The best feeling is when you get to use your new Snap-on tool" and Marlene Kornus, an aircraft engineer from Austria of all places. She says, "my Snap-on screwdriver is my favorite tool. I carry it everywhere with me." These are nice testimonies. They speak to the quality of our product. And beyond that, the actual name, not even associated with the product itself, you can see the images, I show this every year, but I show them again because I'm proud of them. Every year, I get pictures of people who put our wrenches or our tools in the hands of their babies because they believe that Snap-on is a strong influence and it will influence the baby's right for the good. We see birthday cakes and wedding cakes and celebration cakes of all kinds and then unbelievably still, people put ashes of the loved ones in Snap-on boxes. Quality indeed. Now we do say it started with the spark and the spark was an idea, an idea forged a dream, and the dream shaped lives, and we say we are the stewards of that spark -- but most importantly, we are the keepers of that dream. And I have some long-standing employees out here who are still associates with us that I'd like to recognize because they are the quintessential keepers of the Snap-on dream back here, I have Kurt Sauer, who's been with us 43 years, and he is the Director of Manufacturing Process in the Tools Group. He's here with his wife, Susan. Stand up, Kurt. Let's give them a round of applause. John Derrick been with us 44 years, the founder of many of our power tools. Every time you pick up a power tool, the chance are John Derrick had his fingerprints on it. John, stand up, give him a round of applause. And then I have an IT administrator name Louise Pitch. She's been with us 49 years, Louise, stand up. The keepers of the dream. So our Snap-on value creation, the things we believe in safety, quality and then we believe in customer connection. What this means is we don't survey the customer, we go right into the garage or right on top of the wind mill tower, 300 feet in the year to observe the work or go on the flight line. And we do this with 4,700 franchisees, multiple direct sales forces. We are in 700 garages doing this all over the country. We garnered 2.5 billion data events or garage work orders based on our digital presence in the garages. We're in 3,700 technical schools and every year, more than 4,000 people visit this place where we can interact with them over their work. Customer connection is one of our key things that drive us forward. And the insights gained allow us to have innovative new tools where we -- as I said many times today, we bring tools and we summon the future out of what we see today. And if you see this, it seems to be working okay because I've shown you a radar tools here, but we have dozens and dozens of $1 million tools every year. We launched dozens of new tools every year. We have 85,000 SKUs, and we are recognized for motor magazine that named us in their motor top 20 among these tools shown here. And PTEB, the Professional Tools & Equipment News named us as winners of their innovation awards, but most importantly, PTEN does a survey of all technicians, and they voted our tools as the best. And this all comes from engineering. And so I've got a bunch of engineers here that I'd like you to recognize, Ben Gecina, who is from Rochester Hills and one of the things we showed the Board yesterday. One of the things we had to do during the downturn was not invent new products. It was somehow we couldn't get certain chips and certain components, and we had to find alternate designs on a hurry-up basis so we could actually ship Ben Gecina allowed us to ship 30,000 products. And his project won the grand champion in our RCI conference this year. Next in, we have Ken Munson, who has not worked with us that long, but he's the guy who customize the tool so we can get the F-35 again. One of the greatest planes being built in the world, and we do the exclusive tools for us. We have John Anderson from the Tools Group, who designed the ballpen 56-ounce ball-peen hammer that has low shock and won one of our innovation awards. And next to them, we have Nate Lee, who is the Chief Engineer for all our torque designs. Gentlemen, please stand up. Let's give them a round of applause. Safety, quality, customer connection, innovation and then, of course, rapid continuous improvement, getting up every day and figuring out how to do our jobs better. And you might say, "Well, how do we know what really works." Well, let's go back to 2005, I think we got here in 2005 -- I mean, the operating income was 6.5%. Sales were $2.28 billion, I think. And you roll forward to 2022, and the sales are $4.49 million, but the operating earnings, the OI margin was 20.9%. In other words, over that time, 1,440 basis points. 1,440 basis points of operating margin improvement, and this is in a world where people love 10 rapid continuous improvement, really does work in it as a fuel for us going forward. And just a little aside, which we don't have a slide about, if you think back we showed the earnings per share in 2011, I think it was $4.71. The earnings per share in 2005 was $1.89. The earnings per share last year was $16.82, almost 4x what it was in 2011, just in that period of time, 11 years, and 10x what it was early, rapid continuous improvement. Thank you, Jack Michaels. Okay. So those are the runways for growth. We get up and work on those processes every day to make it and improve. It is the table stakes of what we do. But then you have to say, well, you have to grow in your organization. And it's true. So I'd like you to just walk with me a little bit, we had a heritage, a heritage view of ourselves. We made great tools. We sold them through the vans to auto mechanics. And we did it great. But you see, this was just a narrow description of what we actually do. If we step back and we tried to define truly who we are, you get a little different picture. What you realize is part of what I've been trying I've been telling you the whole time here. We observe work. We go into the workplace, we observe work. We get insights out of that. We configure tools. We innovate and get tools that will make work easier. And we can sell those tools, yes, through the vans, but we can sell them through distributors and through direct salesmen. And we do sell them to auto mechanics, but we can sell them actually to any professional, any working men and women who's a professional who is working on a critical task. That is a task where the penalty for failure is high and the need for repeatability and reliability justifies a Snap-on level tool or product. This is a new view of ourselves. And in that new view, we've added a number of brands. I think we have 16 brands up here. But you can see the Snap-on brand. We're not really a branded house. We're a house of brands. We have the Snap-on brand, but we also have a brand from Europe, Bahco. In Europe, when they want the industrial and adjustable wrench and say, "Give me the Bahco." Our people there say that, well, actually, in the United States, they say, "Give me the crescent wrench", but the people in Bahco say, "the crescent wrench got its idea from Bahco," maybe so because the dates lined up. So we added that, but also down here in the lower right for you, we added a new brand wow, 3 or 4 years ago, called Car-o-liner. And now it's the #1 brand in the hottest portion of auto repair, which is collision because the new range of sensors, the new array of sensors around the periphery of the cars made collision a very important part of auto repair. So you can see this. Go ahead. Snap-on most of that -- this is our -- what we're trying to portray here is our value-creating mechanism. We show the processes, some of the software we use to develop product, and we're showing our patent wall, which I invite you to visit afterwards, the 3,244 patents listed there. But what this says is just what I told you before, our principal value in creating mechanism is we observe the work, get an insight, learn how to develop a tool that will make work easier for someone who's operating on a critical task. And the important point about this, the important point about this is that I didn't mention a particular product. This could be a wrench or a piece of software or a database or an aligner or a collision product. I didn't mention a technology. It can be software or hardware. I didn't even mention an industry because it's any industry that's critical. This is what makes Snap-on such a great company and what allows us to continue to grow because we're not just limited to one place. We have a lot of places where we can add value. And so we shall as we go forward. And therefore, we get to our runways for growth. Now, before we get to our runways for growth, let me just say that you can't grow. We have up here, enhance the van channel, expand with repair shop owners and managers, extend the critical industries, and build in emerging markets. And these are all coherent runways, which all depends on criticality. But you can't really expand unless you have a great base and you have continual new people coming in. And one of the great sources why we love the power of place here, why we think Kenosha is a tremendous place is it's got great schools. So feeders for us, people -- schools that turn out our new people that keep reinventing Snap-on and reenergizing our population of associates. And we have some representatives of those schools here today. We have Carmel Ruffolo from Marquette. We have Ritu Raju, the President of Gateway Community College, the Gateway Technical College, up the street. We have my old friend Debbie Ford soon to leave us. I'm very sorry, you're leaving us Debbie from Parkside, and we have John Swallow from Carthage College. Please stand up, everybody. Let's give them a round of applause. Thank you so much. Actually, this is true. If you don't believe this is true, as somebody -- well, when China was the darling of investments, people would invest in China. And one of the things I would say always was, well, it didn't work out. And the reason it didn't work out is they didn't have educated people nearby. This is the problem. And you find this in certain places, you'd make choices. We made a great choice in 1920, when we came here. So we have our runways for growth. So let's talk about them, enhance the van channel. So enhancing the van channel, it's pretty sure. What are we going to do about the van channel? Well, we're going to keep driving the metrics and make sure our franchisees are more healthy and they are healthy. And I can tell you today, when you look at those metrics, you know they're stronger than they have ever been. We're going to work on franchisee productivity because we don't expand our franchisees. We've decided we have 3,700 franchisees, and they are our people, and we are going to rise or fall with them. So to the extent we go higher, we need to have them more productive. We're going to give them better products that can match the changing complexities in the market today. And we're going to try to work with them so that the sales processes on their van get more effective. We're going to expand with repair shop owners and managers. These are customers. The technicians sell -- I mean the franchisee sells technicians to the guys who actually toil the ranch, while the repair shop owners and managers sell to somebody who stands right next to them. They're the owners and the managers of the shop, we're going to leverage our understanding of the garage more and more. Tom Ward can tell you about this forever. So if you want to talk to them, we'll give you a deep briefing, maybe 30 minutes afterwards. But look, we're going to leverage our activities. We're going to try to teach them how to wield the technologies and to manage their business better because some of these are very small businesses. We're going to integrate their progress to try to make it stronger around us. And we're going to keep giving them more -- we're going to get more and more to sell them to make them move forward. You see -- if you think about it, generally, we're here -- we're talking about dealerships and independent shop and independent shops have trouble meeting the complexity, we arm them with the capability to do that. We're going to extend the critical industries. This is rolling the Snap-on brand out of the garage because remember, I said it's not only automotive repair, it's other things like wind and oil and gas and aviation and the military. They're all critical. I mean, think about it in the military, if the bullets 50-caliber bullets are flying overhead, I think the repair is critical. And so we provide that. We're going to reach out to more of those. That business grew at 19% in the last quarter. It's growing. We're going to reach out more of that. We're going to reach out to more. We're going to learn more about the work visiting the sites more and therefore leading to more products that will expand our business there. So we're going to enhance the van channel, expand with repair shop owners and managers, extend to critical industries, and we're going to build an emerging markets. And all that means is, since they're all emerging, and it's all fertile ground is building a manufacturing capability and we do. We make in the markets where we sell. And so if you're going to sell in any place like India or China or other places you've got to make in those markets and we'll have the manufacturing. We're going to build the sales network because we actually got to sell one of the disadvantages of trying to build the business there is you actually have to sell. And we're going to -- in the case of say like India or China, we're going to Asianize the product to fit the local customers. And this is what we will do. And I think we have good opportunities to do this. If you see the growth going forward, we have some things that drive us forward that encourage us that we're going to be able to grow. First is if you want to just roll back the cars, it's the aging of the car park. Look at this, if you go back to earlier in 2001, I think, carpark was 9 years old, 9.5 years old, it's now 12.2 years old. And if you watch the red line, it's gotten older every year almost. It just gets older. It's arithmetic and older cars need more repair. So we think this is a good thing for us. We believe this will be good. And then if you step back and you look at the day, I kind of say, this is the golden age of car repair. We're on the edge of the golden age of car repair, and I believe it is. If you look up here, you'll see that -- I don't have the numbers up here, but it says that people are investing almost double digits more in repair in their car than they did just a year ago. The wages for technicians are going up high single digits. And the number of technicians, which used to be growing at 0.5% or 1% are growing faster than ever, like in mid-single digits. So in fact, that business is growing just with the aging of the car park, but it's certainly being driven by something else, cars are getting more complex. Now everybody knows that you're going to have you're going to have electric cars. But electric cars are going to drive our business more because you're going to have internal combustion on the road. At the same time, electric cars are going to need more tools. But another thing, just think about the autonomy in your car. We talked about this, there's something called ADAS, Advanced Driver Assist Systems. Well, these are things like lane departure warnings or blind spot detectors and they are driven by an array of sensors around the periphery. So every time you damage one of those, any time you break, you get a crack in your windshield, every time you bang your bumper, when you take it to the garage, check the bill, you will find out that things are getting more complex. So there are more and more opportunities in this direction. Now one of the things to take advantage of all this is, as I said, about the schools, you have to have new people. So I have some of the new people here that I want to introduce to you that are going to help us and propel us into this future, of course, being helped by the universities and the schools that have provided been to us. So I have today, Jada Peters, who's been with us a couple of years, and she's in marketing, and she went to Parkside. I have Tina Wuebben who is an engineer in industrial who also is been with us around 2 years, and she went to University of Wisconsin Platteville. I have Brandon Ronning who went to Dayton, well not one of our local schools, but is a plant controller in Milwaukee, and I have Grant Fisher, who went the Carthage and also went to law school in Marquette and he's part of our legal department. Please stand up, ladies and gentlemen. Let's give them a round of applause. The new generation here. All right. Go ahead. So I showed the trends. I showed 2022. And you might ask, is it continuing? Because when you turn on the TV shows, or you read the paper, and you listen to the financial community, you think you've held a number of modern day Paul Reveres. The recession is coming. The recession is coming. The recession is coming. They've been saying it for months. Well, it ain't coming here yet. If you look at the first quarter results, you see -- look at these numbers. Organic sales in the first quarter, up 10.2%. If you look at the OI margin 22%, up 170 basis points over last year. As I said on the call, "boom shakalaka, that's quite a number." And then we had the EPS of $4.60, up 15% year-over-year. So in effect, if you look at the first quarter, things are accelerated. I'm not saying it's going to continue, but things are looking pretty good now. We've got a lot of momentum. And I'd just like to introduce 3 people who especially contributed to this quarter because one of the stars was our equipment business. I'd like to introduce from Conway, Arkansas, Steve Rogers from Louisville, who's one of our engineers in the aligner business. I'd like to introduce from Louisville, Kentucky and actually lived here for a while. Mr. Steve Roger has been with us, I think, 43 years or 36 years. I think Brian Spikes from Louisville, Kentucky to the plant manager of our lift business down there. He's been with us 23 years. And then the head of all this with us 33 years, Mr. Gino Amador, who uniquely has worked for Snap-on on 4 different continents. Gentlemen, thank you so much for your contribution in the first quarter. Stand up, please. That's sort of my story. I kind of ran out of slides. But look, this is a great company, unique and special. And it's special because, of course, our founding and the idea that we know who we are. It's also special because we wield tremendous insight. Great insight and experience forged over decades sharpened by the new and guided by the work. This is why we're able to succeed because we're able to bring to bear all those things. We are a company that is resilient. You can see it in the 4 I showed, $3.730 billion of sales before the COVID goes down to $3.59 billion comes up to $4.25 billion and then goes to $4.49 billion, resilience indeed. We have been able to -- as you saw the trends going all the way from 14.5% OI margin in 2011 up to 20.9% last year, and that has been guided by great management through the resilience and some of my great predecessors along that range of trend. You see, you can see it in the numbers. You can see it in those numbers. 2022, sales were up organically or sales of $4.49 billion, almost $4.5 billion. Profitability, 20.9%, up 90 basis points over last year and up 170 basis points over the pre-pandemic levels and the EPS. The EPS of $16.82, up year-over-year by 12.7% and up 35.5%, over pre-pandemic levels, and you can see it's continuing. You can see it's continuing in the first quarter of 2023, sales up 10.2%, OI margin of 22%, up 170 basis points year-over-year and $4.60, up another 15%. These are gigandous numbers. So I would sort of want to end how I started. Your company, the Snap-on company, your company, our company has never been, never been, never been stronger. They have never been stronger. The voice is the voices in the video and the numbers across the page, defining the results, they all say it so. But one final point, this is all because of the people in this room, you have contributed to this. For all of that, for your contributions to this great record, this encouraging record. You have my congratulations, and you have my thanks. Now we're going to take questions. Let's have some questions. Do we have any questions. I guess the Bucks questions are off the table.

Great. Our first question will come from Andy Jen.

Good morning, Nick.

Good morning, Andy.

You've been a strong spokesperson for manufacturing for a long time. If you think about U.S. manufacturing and what's going on with current economic and workforce conditions, what's your taking on all of that?

Look, I think this is a great time for manufacturing and well, it should be. I think there's a question. I tried to touch on it in my remarks. There was a question is, how is it that America was ascended over all the countries in the Western world when they kind of shut off the gun at the same time like 400 years ago. And historians have said without equivocation, without question, without qualification, that's because in America, we from sea to shining sea, have had makers and fixers. People who could do things. This is how we ascended to where we were. This is how we won the great World War 2. It's because we had this industrial substrate that allowed us to make 3x as many war planes in 1 year in 1942 than the axis powers made over 3 or 4 years. People like Rosie the Riveter and Wendy the Welder and their colleagues working in the factories. And then actually, if you think about it, this is how we got through the COVID. If you doubt that and you were -- and I think people appropriately were sheltering in place, but when there was sheltering in place, when you hit the switch on your lights did they come on? When you ordered food was it there? When you bought something on Amazon, did it occur? Did it come in when you bought something on Amazon was it delivered by a truck driver who couldn't work from home, but was standing their ground. You see the essential workers are actually the backbone of the country. And I think coming out of this, people have started to see it. We were in a -- I don't know, a little bit of a political platform here, I suppose, but it's not partisan. I mean the point is, I think for a while, we were shifting jobs away, our economy away from being an economy of creation to economy of transaction. More people went into financial services, nothing wrong with financial services. But financial services employ 7% of the people in the United States. They generate 25% of the profits. Manufacturing is the opposite. And I wonder, for a period of time, we thought we had income and equality. Well, that's the basis of this. And so for a while, we said, "Oh, isn't it great. We can get cheaper products from shipping stuff outside the United States," and that's what we did. It really was came out of the last great inflation. When inflation hit and the wage price spiral started, Ford Motor Company where I worked in other places, flagged America because they wanted to reduce their costs. So they built those, built places elsewhere and imported things and created these great supply chains, which got more and more efficient, driving cost down and down and down. So we had less manufacturing, but people didn't quite notice because the goods kept getting cheaper. Then comes the COVID and it's like throwing a dirt into a fine-tuned machinery, it stopped every mill, supply chains didn't work, and we realized how important it was to a short supply chains and how essential manufacturing was to us. So I think now we're starting to bring manufacturing back and well we should. I did there in Chicago and the other now about 3 or 4 months ago, and people said, the industrials at the table, so they all wanted to open factories in America, but they couldn't find the people. That's why we need good schools to generate the people and to give them the skills, not necessarily of tomorrow, but of today. The National Association Manufacturers has said there are 686,000 jobs open right now. We can't find people to fill them. We need to upskill the American workforce and be able to fill them but if we do, America will prosper because the strength of America has always been the makers and fixers. We don't want to be in a situation where we are kind of lightly and glibly. Countries like China or other places send us cars and we send them poetry. We don't want to do that. Americas is a people who has always risen or fall on the ability of our people to do things, business manufacturing. It is the Quintessential American occupation, and I'm glad to see it starting to expand. Other questions?

Next question is going to be from Bud Clark.

Looking sharp, Bud.

Thank you, Nick. Good morning. It looks like there are some tool companies that are closing factories here in the United States. What are we doing with our plants here in the U.S.?

Actually, we just talked about this yesterday with the Board of Directors. We're expanding a number of our plants. Milwaukee is expanding. Algona is increasing its capacity. Elizabethton is increasing its capacity. Conway is expanding. So I think you would say that we're not among those that are contracting. We are building almost across the board because we have demands. Actually, like I said, I really meant it. I think this is the golden age of auto repair. And even if it goes down, we want to be ready for the next income because we have belief in the American economy. And I don't think even if it goes down, it's not going to be there for that long, and we are going to be ready when it comes back. But I'm anticipating that it won't go down. If it does, we manage through it. But expanding here is because we have a great market here. And so we need the capacity, and that's what we're doing. We spend a lot of money in all of those -- well, we're spending varying money in all those places. But we're doing it because we have faith in America. Now sometimes, I think people wonder -- I had this the other day on Bloomberg. They said, "Gee, won't making in America increased costs." And I said to the interview, "you think, it will increase cost for a time. Because the change will make it more expensive. But I believe Americans prefer to have good jobs and be able to afford more expensive products." And then, by the way, eventually, through rapid continuous improvement, you catch up, you drive those costs down, that's what happens. And so we believe that will work for us. Some people think, some people say, "I'm not sure we so to invest in manufacturing here because the American worker is the question is a question." I said "the American workers not the question. The American works the answer." All we need is schools to educate more and more of them. This is why we take upskilling the American workforce as our social costs because we think it's more important to the future of American. I see no path to ongoing prosperity in America without continuing the upskilling and continuing to expand manufacturing. Okay. Next.

Okay. I have a question, and you touched on it, briefly.

Thank you.

Briefly about electric cars. As you know, I'm one of the many people here at Snap-on that drive electric cars.

I wouldn't have used the word many, but okay.

It's growing.

You are one of those people who drive electric cars. I'm not saying there's anything wrong with electric cars, just some of the drivers.

What I was wondering, what are Snap-on's plans to come up with ways to repair and ever -- it's changing constantly. What is Snap-on doing about that? What are your plans?

Look, actually, what we tried to -- I tried to communicate here was that change is good for us. We're in the shops. We see the task change, and we make new tools for it. I mean, if you think about it, okay, let's say, hand tools. We sold more hand tools last year than ever before, ever before. How did that happen, we guarantee hand tools for life. By the way, we have a big share in the market. We guarantee the products for life, how is it that we have any business at all. And the reason is, is because, it's really because the cars keep changing. So even though you bought the ratchet last year that was going to fix a certain car, new cars, like electric cars are going to need different stuff. Now electric cars, one of the things no one knows exactly what -- so that's why one of the reasons why we bought Dealer-FX. Dealer-FX does the repair shop software. In other words, they provide the software that manages a repair shop for dealerships. And the first place you see what's going to go wrong in cars is in a dealership because people bring them into a dealership. First, they're on warranty and so we get to see that. One of the things we're seeing about electronic about electric cars is our early opportunities are the batteries, you can't get them out of there without a special lift. If you think about it, you lift from underneath the car, if you got a normal lift there, you're going to be able to drop the battery if there's a problem. So you need a whole new set of lifts. We love it. You need a bunch of insulating tools. You poke around there with those batteries. You're going to fry yourself. If you're not careful, so you're going to need some insulating tools. The whole idea of charging stations, the dealerships don't know how to put them in place. So we're helping them with contracting. And more and more of that is going to happen. You're going to need to manage the air conditioning systems because the batteries aren't going to work so well. If your air conditioner breaks down in hot weather. And we're going to see that as it comes through in the business as things change. Basically, what we do is we observe the work. So what that says is, as cars break down, as there's difficulties we see what will repair them more effectively. So every time a new car comes out, it generates more product for us, really. And it's a very interesting thing. That's why we have a business and our business keeps growing because the number of new cars keep coming out. Now electric cars, you may think electric cars and electric cars and electric carbon. In reality, they're all different. They skin the cat. Each manufacturer skins cat a different way, so they're going to need different tools for each manufacturer. This is the way new technology occurs. Anytime new technology rolls out. It usually doesn't roll out in coherent weights. So you see that. Plus something you don't -- we don't hear about much in the United States is in China last year, which has more electric-powered vehicles than any place else in the world, probably the highest growing on a percentage basis was plug-in hybrids, where you have a smaller battery that allows you to drive, say, 50 miles and there's an internal combustion engine. So in that car, you're going to need both types of tools to manufacture to service it. And then on top of it, the electric cars tend to depend on the autonomy and that requires more tools to deal with it, hardware and software. That's why I think it's a golden age of automotive repair. You have one, you have the car park growing in internal combustion. 2, you have new powertrains rolling out, whether it's plug-in hybrid, regular hybrid, or electric vehicles; and 3, you have overlaid on top of this, all this drive to autonomy, which requires more and more difficult repair. And when you go to your garages, these guys aren't necessarily -- the mechanics aren't necessarily schooled in all of this complex repair, and we are ready to put them right on target for a fee. Okay. Who else? Yes.

This is going to be our last question from Leslie Sepanski.

Leslie Sepanski.

You talked about bringing Snap-on out of the garage. Can you expand on this?

Sure. I think I said that our principal value creating mechanism is to observe the work and take that insight and create a tool that will solve problems for critical industries. And boy, there's auto repair, which is critical. If you don't think auto repair is critical, just try to leave your car there for like 3 weeks. You'll think it's critical, and so I think that's one. But 2, if you think about it, oil and gas is critical, you kind of like the heater or light your house. Military is critical. As I said, 50-caliber bullets are a great incentivizer. Things like mining is critical. You don't want to be down a mile underground when things go wrong, and it isn't working correctly. Aviation, you don't want to be on a plane if everything isn't working well. All of this is critical. The penalty for failure is high, and we can take advantage of it. And that's the industrial business. That's the warehouse back here that's making increasingly more customized kits for all those businesses. And we believe in this business. It went up, like I said, it went up 19% in a quarter in the first quarter, and we can believe that one as an indication of how good the business is or how we feel it's going to be important. But all you have to do to really get a feel for how much we think this business is going to be strong, is to go out the store, straight out the door and then take a 90-degree right and look at the Snap-on sign on that building. We built it here in Kenosha for the industrial business. So we believe in rolling the Snap-on brand out of garage and increasing and it's looking like a great bet. Okay. I guess that's the last question. So thank you all for those questions. Look, not you, Steve. That was weak, weak. Steve is a fan of basketball, he gave me 2 tips for the NCAA tournament. Not good. First of all, to bet on a team and the tournament, they should be in the tournament. This is a problem. Okay. Look, my friends, I'd just like to take a moment to reflect about our corporation. It is, I've said many times this today, but I want to say again one last time. It is a great company, unique and special, founded 103 years ago on a special principle, the respect for the dignity of work, a timeless principle and enlisted in a cause, enabling critical activities, critical people, working men and women who work on critical past, something that was relevant when our founders were here and is relevant today. It's a company that has demonstrated incredible resilience come heck or high water; we seem to have done okay. Based on our leadership, based on our associates, based on our capabilities. And one of the reasons why we said we've never been stronger. And one of the reasons why it is, is we have certain decisive advantages. These are things in good times and bad, we keep nurturing our product. Authored by connecting with the customer and the garage and given shape by innovation that enables without a doubt, without any question, people will say, it enables them to perform the critical tasks. Our brands, our brand, it's a special brand, respected, sought. A brand that instills and bestows pride and dignity that marks the special, the professional, and the serious like no other, and we have people, our associates, but all of you in this audience, but certainly, the associates; challenge, tested, and fully committed. And we have advanced because of our strengths in product and brand and people. We say this all over our literature. And in fact, it is true. You can see it written across the numbers. And it all comes back to -- it kind of comes back to -- you ask yourself, what's the corporation. What should we expect from a corporation. One of the things I want to tell you is I want you to look at these remarks in this context. What do you expect from a corporation, a corporation is an organization, a collective organization in which people come together to create a benefit for themselves and others, which they could not create individually. And here at Snap-on, that works. We are the beneficiaries of the fact that we have the confidence of our investors, the commitment of our associates, the conviction of our franchisees, the faith of our customers, the support of our communities, and yes, we have the legacy of our retirees. To the extent we reach higher, all your retirees, we stand on your shoulders. And it all comes back to something we know -- the world we know, the way we move, where we live, the cities we raise, the energies we wheeled, the hopes we hold, and the dreams we dare are all shaped by work. We are the people of that work. That's why I'm so enlisted in the idea of manufacturing. It is quintessential work. This is why our company succeeds because work is essential and we are generating benefit for ourselves. I hope you all feel that, and we're generating benefit for others. You can see it in the words of that tech from Jersey. There's no better feeling than holding my new Snap-on tool. This is value for others. Coming back to the video, this value. The world is evolving, and we are part of it, and we are enabling its progress. It's pride. It's dignity. It's dreams. It's lives. It's Snap-on. It's all of you. And we make a difference and you know it's true. You see this is a company with an historic past, an exciting now, and a promising future. And it's all what you have authored, you have been part of it. You have been part of it, you are part of it, and you will be part of it. You know that's true. So for me, I would say that you have made a contribution, for your contributions, I congratulate you for their success, and I thank you for the success. And for allowing me -- as we move this company forward, this collective forward, it's my great privilege, and a fulfillment of my dreams to be part of it all with all of you. And for that, I thank you all. Thanks so much.