Good day, and welcome to the Standex International Fiscal Fourth Quarter 2021 Financial Results Conference Call. All participants will be in listen-only mode. Please note, today's event is being recorded. I would now like to turn the conference over to Gary Farber with Affinity Growth Advisors. Please go ahead, sir..

Thank you, operator, and good morning. Please note that the presentation accompanying management's remarks can be found on the Investor Relations portion of the Company's website at www.standex.com. Please refer to Standex's Safe Harbor statement on slide 2.

Matters that Standex management will discuss on today's conference call include predictions, estimates, expectations and other forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially.

You should refer to Standex's most recent Annual Report on Form 10-K as well as other SEC filings and public announcements for a detailed list of risk factors.

In addition, I'd like to remind you that today's discussion will include references to the non-GAAP measures of EBIT, which is earnings before interest and taxes; adjusted EBIT, which is EBIT excluding restructuring, purchase accounting, acquisition-related expenses and onetime items; EBITDA, which is earnings before interest, taxes, depreciation and amortization; adjusted EBITDA, which is EBITDA excluding restructuring, purchase accounting, acquisition-related expenses and onetime items; EBITDA margin; and adjusted EBITDA margin.

We will also refer to other non-GAAP measures, including adjusted net income, adjusted operating income, adjusted net income from continuing operations, adjusted earnings per share, adjusted operating margin, free operating cash flow and pro forma net debt to EBITDA.

These non-GAAP financial measures are intended to serve as a complement to results provided in accordance with accounting principles generally accepted in the United States. Standex believes that such information provides an additional measurement and consistent historical comparison of the Company's performance.

On the call today is Standex's Chairman, President and Chief Executive Officer, David Dunbar; and Chief Financial Officer and Treasurer, Ademir Sarcevic..

Thank you, Gary. Good morning, and welcome to our fourth quarter fiscal 2021 conference call. I'm very proud of our accomplishments in what has been an unprecedented and challenging environment over the past year and a half.

I want to thank our employees, executive teams, and the Board of Directors for their contributions and dedication in making fiscal 2021 highly successful year for Standex. I look forward to further collaboration as we enter fiscal 2022 with a strengthened operating profile and some very new and exciting opportunities in front of us.

Now, as everyone can turn to slide 3, Key Messages. We ended fiscal 2021, with strong fourth quarter results and solid execution on our growth strategy.

At the Electronics segment, approximately two-thirds of the 63% year-on-year revenue increase in the fourth quarter reflected organic growth, with continued broad-based geographical recovery, including increased demand for relays in solar and electric vehicle applications.

As reflected in our backlog trends, we're continuing to see strong demand across many of our product lines and all geographies at Electronics. Our Scientific segment also had a strong quarter with solid revenue and operating income growth year-on-year.

We also have an active pipeline for new product development at Scientific, and recently received our first product patent in this segment, which I will discuss later in the call. At the Engraving segment, revenue increased approximately 16% year-on-year, reflecting a favorable geographic mix, project timing and increased soft trim product demand.

Execution on our Portfolio Transformation Strategy has strengthened both Standex's operating performance and strategic positioning as we further expand our end-market focus and introduction of new products. From a financial standpoint, -- segments are focused around high quality businesses that optimize our growth and margin profile.

Total Company backlog realizable in under one year increased 19% sequentially in fourth quarter fiscal 2021 with strength in Electronics, Specialty Solutions and Engineering Technologies.

On a consolidated basis, we reported an adjusted operating margin of 12% in fiscal 2021, representing a 90 basis-point increase year-on-year with our fourth quarter margin of 13.3%, the highest quarterly margin Standex has ever reported.

The reshaping of our portfolio has also enabled us to accelerate our investment in resources to aggressively pursue opportunities in end markets that have healthy growth prospects, such as electric vehicles, renewable energy and smart grid.

Our strengthened competitive advantages in these markets drive innovative product solutions, which leverage our technical and applications expertise and resonate with our customers.

For example, we've been partnering with a major global energy company on a multiyear development effort and have recently delivered prototype modules to support projects in the renewable energy sector.

The potential to scale production to support this project and to commercialize other exciting and innovative organic growth opportunities throughout the Company has reached a level that requires executive oversight. It marks another step on our journey towards becoming a high-performing industrial operating company.

Last night, we announced the creation of a Chief Innovation and Technology Officer role in response to these types of new end-market and growth opportunities on which we plan to capitalize.

We are promoting Flavio Maschera, President of Engraving, to this new Innovation and Technology role, which will also be a member of the Standex corporate executive team. Flavio joined our Engraving segment in July 2006 as VP of Europe, and has led our efforts into successfully transforming the Engraving segment into a global texturizing business.

He has also championed growth laneways into performance services and expanded into the growing soft trim tool market. His innovative approach has enabled Engraving to maintain its position as the technology leader globally.

Flavio’s depth of experience in innovation and new technology development and strategic insights will be a tremendous asset Company-wide. I am also pleased to announce that Jim Hooven will step into the role of President of the Engraving segment. Jim joined Standex in February 2020 as Vice President of Operations and supply Chain.

In September of 2020, Jim was -- also took on responsibilities as Interim Vice President and General Manager, North America for the Engraving segment, while maintaining his role as VP of Operations of Supply Chain for Standex.

Out of Jim’s guidance, the North American business has made steady progress, strengthening operational excellence, processes, developing talent and achieving results. We've also begun a process to address Jim's prior role of Corporate VP of Operations and Supply Chain.

Underpinning our growth strategy is an active pipeline of productivity and efficiency initiatives. This is enabling us to mitigate the impact of supply chain issues, and material and wage inflation which is affecting the broader industrial sector.

A few of our actions, which I want to highlight, include continued lean initiatives implemented across our production plant footprint, enhanced strategic sourcing to direct material synergies.

In addition, our focus on mitigating material inflation and improving our cost position in the Electronics segment, through changes in reed switch production and material substitution is expected to be substantially complete by the end of fiscal 2022.

We are in a very strong financial position to pursue organic and inorganic growth opportunities, given our significant financial flexibility, as a result of a strong balance sheet and liquidity position and consistent cash flow generation. Ademir will discuss our financial performance in greater detail later in the call.

As far as our outlook, in fiscal 2022, we expect stronger financial performance, reflecting positive demand trends, the impact of additional productivity initiatives and our significantly strengthened operating profile.

In the first quarter of fiscal 2022, we expect a slight decrease in revenue but a similar operating margin compared to fourth quarter fiscal 2021. Now, please turn to slide 4 and I will begin to discuss our segment financial performance, starting with Electronics.

Revenue increased $28 million or 62.7% year-on-year, reflecting a 42.2% organic growth rate or an approximate $19 million increase. The Renco acquisition contributed approximately $7.3 million in revenue and continues to be a highly complementary fit with our magnetics portfolio.

Our Electronics operating margin increased to 21.6% compared to 13.1% in the year-ago quarter, reflecting operating leverage associated with revenue growth and productivity initiatives, partially offset by increased raw material costs.

The expansion of the Electronics segment through new markets such as electric vehicles and renewable energy, as well as the impact of prior acquisitions, like Agile Magnetics, are adding to our prospects.

We continue to leverage the sales synergies of our Agile acquisition in markets such as semiconductors and through the expanded capabilities this provided us. In particular, NBOs contributed in excess of $15 million in fiscal 2021, compared to our prior estimate of $12 million on our third quarter earnings call.

Our pipeline remains healthy, with total segment backlog realizable under a year, increasing approximately $22 million or 23% sequentially in the fourth quarter, as we continue to see strong growth in reed switch based products and magnetics applications.

Sequentially, at the Electronics segment, we expect a slight increase in revenue and a moderate increase in operating margin in first quarter fiscal 2022, reflecting continued end-market strength in reed switch and relay products as well as further growth in the North American magnetics market.

Please turn to slide 5 for a discussion of the Engraving segment. Revenue increased approximately $5 million or 15.9% year-on-year with operating income growth of approximately $3.1 million or 119% year-on-year, reflecting a favorable geographic mix, timing of projects and increased soft trim product demand.

Operating margin increased to 15.4% compared to 8.1% in the year-ago quarter, reflecting the volume growth combined with segment productivity and our cost initiatives.

With our GS Engineering acquisition now integrated, we have further globalized the business and leveraged the technological advantages, resulting in a very-strong backlog for soft trim demand, as the auto industry focuses on interior comfort of vehicles and increasingly replaces leather with sustainable material.

Laneway sales at Engraving were approximately $14.8 million, representing a 9% increase sequentially and greater than 50% increase year-on-year, including growth in soft trim tools, laser engraving and tool finishing.

Sequentially, in first quarter fiscal '22, we expect a slight to moderate revenue and operating margin decrease, primarily due to the timing of texturization projects and regional mix. We do expect continued strength in soft trim demand. Turning to slide 6, Scientific segments.

Revenue increased approximately $8 million or 62.7% year-on-year, reflecting positive trends in pharmacy chains, clinical laboratories and academic institutions, primarily attributable to demand for COVID-19 vaccine storage.

Operating income increased 48.7% year-on-year, reflecting the volume increase balanced within investments to support future growth opportunities and higher freight costs. At the Scientific segment, we have added to our engineering and product teams to further develop a growing pipeline of potential new products.

Pictured on slide six is our recently patent approved, controlled auto defrost refrigerated solution or CAD, designed for safe and effective frozen medication storage for end markets such as pharmacies, labs and clinics.

This is the first product in the marketplace, which enables auto defrost while guaranteeing vaccines remain below critical temperatures, thus eliminating the need to manually defrost the freezer.

The development of this product is reflective of our focus on increasing the exposure to proprietary technologies and growing our intellectual property portfolio.

At Scientific in fiscal quarter 2022, we expect a moderate sequential decrease in revenue and a slight decline in margin, reflecting lower demand for COVID-19 vaccine storage refrigeration and increased freight costs, partially offset by price and productivity actions. Turning to the Engineering Technology segment on slide 7.

Revenue decreased $5.7 million or 21.8% and operating income was $1.1 million lower, representing a 25.6% decrease year-on-year. The decreases primarily reflected the absence of the recently divested Enginetics business and the economic impact of COVID-19 on the segment and market.

On a sequential basis, operating margin increased to 15.1%, compared to 6.2% in third quarter, reflecting a continued broad-based sequential end-market recovery and favorable mix complemented by ongoing productivity initiatives. Sequentially, we expect a slight to moderate decrease in revenue and operating margin, reflecting the timing of projects.

We are entering fiscal 2022 with an active new business pipeline, particularly in the space and aviation sectors. Highlighted on slide 7 are numerous aerospace and space platforms, we are aligned with, reinforcing the strength and appeal of our spin forming capabilities, which continue to resonate with customers.

Please turn to slide 8, Specialty Solutions. Specialty Solutions revenue increased approximately $1.7 million or 7.1% as its end markets, particularly in foodservice and specialty retail continue to recover. Operating income decreased approximately $700,000 or 18.7%.

This reflected the impact of work stoppages which have since been resolved and material inflation which we are seeking to recover through pricing actions. Highlighted on slide 8 is our Procon designed next generation Helical Gear Pump for food and beverage applications, such as coffee, espresso, milk foaming, syrup and reverse osmosis.

We believe this product is possibly 20% more energy efficient than current gear pump technology with a longer service life.

In first quarter fiscal 2022, we expect a slight sequential increase in revenue and operating margin, primarily due to growth in merchandising and the Procon pumps business partially offset by the impact of a prior work stoppage that has been resolved.

I will now turn the call over to Ademir who will discuss our financial performance in greater detail..

Thank you, David, and good morning, everyone. First, I will provide few key takeaways from our fiscal fourth quarter 2021 results which exhibited strength across key financial metrics. We had solid financial performance in the fourth quarter as both revenue and adjusted operating margin increased sequentially and year-on-year.

From a revenue perspective, four of our five segments reported year-on-year growth, led by the Electronics and Scientific segments with total organic growth over 20% as compared to fiscal fourth quarter 2020.

In addition, from a margin standpoint, adjusted operating margin of 13.3% is the highest quarterly margin that Standex has ever reported, reflecting successful leverage on our volume growth, continued readout of price and productivity actions as well as impact of the strategic portfolio actions David highlighted in his comments.

Our cash generation and liquidity metrics also continue to be very strong. In the fourth quarter, we reported free cash flow of approximately $26 million or 36% year-on-year increase. In addition, we generated a free cash flow to GAAP net income conversion rate well in excess of 100% in fiscal 2021.

Our net debt to EBITDA, interest coverage ratio and available liquidity, all improved sequentially. We’re entering fiscal 2022 with a very strong financial profile, supported by positive demand trends, our active pipeline of productivity and efficiency actions and our expectation for continued solid cash generation.

Now, let's turn to slide 9 fourth quarter 2021 income statement summary. On a consolidated basis, total revenue increased 26.6% year-on-year from $139.4 million to $176.4 million.

Revenue increase primarily reflected strong organic growth across most of our segments, positive contribution from the Renco acquisition and favorable FX, partially offset by the divestiture of the Enginetics business in the third quarter of fiscal 2021.

Organic growth was 20.5% while Renco contributed approximately 5.2%, and FX contributed 3.5% increase to the revenue growth.

On a year-on-year basis, our adjusted operating margin increased 460 basis points to 13.3%, reflecting operating leverage associated with revenue growth, readout of price and productivity actions and profit contribution from Renco, partially offset by the impact of work stoppages in the Specialty Solutions segment.

In addition, our tax rate was 20.7% in the fourth quarter of 2021, compared to 26.7% in the fourth quarter of fiscal 2020. We expect the tax rate in the 24% range in fiscal 2022 with a slightly higher tax rate in the first quarter. Adjusted earnings per share were $1.40 in the fourth quarter of 2021, compared to $0.65 a year ago.

Please turn to slide 10, fourth quarter 2021 free cash flow. Our solid working capital performance and execution was evident on several fronts. We generated free cash flow of $26.4 million in the fiscal fourth quarter of '21, compared to free cash flow of $19.5 million a year ago.

In fiscal 2021, we achieved 118% free cash flow to GAAP net income conversion, inclusive of approximately $8.1 million in pension payments made during the year. Next, please turn to slide 11, a summary of Standex's capitalization structure and liquidity statistics, which remained very strong.

Standex had net debt of $63.1 million at the end of June, compared to $82.1 million at the end of March, reflecting free cash flow of approximately $26.4 million, partially offset by $5 million of stock repurchases along with dividends and changes in foreign exchange.

Net debt for the fourth quarter of 2021 consisted primarily of long-term debt of $199.5 million and cash and cash equivalents of $136.4 million with approximately $92 million held by foreign subs. All liquidity metrics reinforced our significant financial flexibility.

Standex's net debt to adjusted EBITDA leverage ratio is approximately 0.57 at the end of the fourth quarter, with a net debt to total capital ratio of 11.1%. The Company's interest coverage ratio increased sequentially from 11.4 times to 13.1 times at the end of the fourth quarter.

We had approximately $245 million of available liquidity at the end of the fourth quarter and continue to repatriate cash, with $6.8 million repatriated during the quarter. In total, we repatriated approximately $38 million in cash in fiscal 2021, slightly ahead of our initial expectation.

From a capital allocation perspective, we repurchased approximately 50,000 shares for $5 million in the fourth quarter. In fiscal 2021, we repurchased a total of 267,000 shares at an average price of approximately $79 per share. There's approximately $22 million remaining on our current repurchase authorization.

We also declared our 228th consecutive quarterly cash dividend on July 22nd of $0.24 per share. Finally, we expect capital expenditures between $25 million and $30 million in fiscal 2022, compared to $21.5 million in fiscal 2020. I will now turn the call over to David for closing comments..

Thank you, Ademir. If everyone can please turn to slide 12 for key takeaways. The transformation of our portfolio around businesses with attractive growth and margin profiles as well as strong customer value propositions is contributing to our solid performance.

We are investing our resources in end markets with healthy growth prospects and are favorably aligned with global trends, which leverage our technical and applications expertise.

We have an active funnel of productivity and efficiency initiatives, focused on strengthening our market leadership and cost positions, which we believe will mitigate to some extent some of the near-term industry headwinds, such as raw material price increases and supply chain issues.

Our financial strength and consistent free cash flow generation support a disciplined and opportunistic approach to capital allocation. In fiscal 2022, we expect stronger financial performance reflecting positive demand trends, additional productivity initiatives and significantly strengthened operating profile.

Operator, I will now open the line for questions..

Thank you. We will now begin the question-and-answer session. Today's first question comes from Chris Moore at CJS Securities. Please go ahead..

Good morning. Lots of good stuff here. You talked about delivering some prototype modules to renewable energy producer.

Could you maybe provide a little more detail there? I don't know if you can say who the customer is, potential scale, timing, anything else that you could share on that?.

Yes, of course, Chris. For those of you who have been following the Standex for some years, we started talking about what has turned into this project some years ago. When our Engraving business discovered that they could apply some of their process technology to improve the efficiency of solar panels.

They've been working with Enel, E-N-E-L, the Italian power producer, for just over three years now on a development project in close partnership with an Enel and their engineering teams. And it's been funded in part by Enel.

And the modules we're delivering are our photovoltaic modules that are intended to be made in the future from recyclable plastic. It's right in the heart of the top strategic priorities for Enel.

And one of the reasons we've created this Chief Innovation and Technology Officer role is because the project is getting to the point, it requires a great deal of time and focus. We want to get it right. And Flavio, who has led this project in the Engraving business, is a perfect person to bring this to maturity.

And as he's worked on it, he's actually incorporated Electronics. We have some electronic scope of work in the same project. So, it's actually becoming a cross Standex project. Now, it's still in development. We're still developing -- delivering modules. But, we're obviously excited enough about it to be focusing some resource on it..

Got it. Very helpful. May be turning to margins, Electronics and Engraving for certain. Electronics margin is very strong, 21.6%.

Is that sustainable moving forward?.

Yes. Hi. Good morning, Chris, it's Ademir. We believe it is. We have spoken about Electronics getting to that 20% plus EBIT margin. The team has done a phenomenal job managing the rhodium cost inflation and offsetting with price, a lot of good productivity actions. So, we believe that the 20% margin for Electronics is where the business should be.

And frankly, we also want to invest in the growth in this business going forward. So, yes, I mean, I think that's achievable..

Got it. That's helpful. And in terms of….

Chris, in the last few quarters, we've talked a lot about rhodium and the pressure that was putting on the business. Well, I’d tell you that the Electronics team has put in place a very robust process to manage the price. They know exactly what they’re quoting around the world. Every month, they are updating their price list.

And this is a discipline that did not exist before this rhodium experience. So, we view that as a long-term enhancement to their ability to manage their business. And it was directly responsible for a lot of the margin improvement we saw in Q4. And it enables the team to deliver, as Ademir described, consistent margins in the future..

Got it, I appreciate it. And just in terms of Engraving.

So, what will it take to get to the 20% level? And is it -- do you have a reasonable expectation in terms of timing, is that a sort of two-year process, or how should we look at that?.

Yes. I think, Chris, as we mentioned, that's obviously our objective for the Engraving business as well, with Jim taking a global leadership role and a really good sign up and operating discipline that he is putting in place along with the market recovery. I think the timeframe you kind of see today is a reasonable timeframe.

And we're looking to getting a sequential improvement as we move through the rest of the year in Engraving as well. So, yes, I mean, I think that's where we would like to get, and that's the plan..

And our next question today comes from Chris Howe at Barrington Research. Please go ahead..

Well, first off, on the Scientific segment, you talked about the opportunity that's out there within small physician offices.

Is there a way to think of the Scientific opportunity and how you've benefited from new store rollouts during the pandemic, during the Delta variant? And as new stores roll out, will this CAD refrigerated medication storage equipment cabinet be preferred over the more traditional cabinet, and what type of financials or profit is in this CAD cabinet?.

So, I’ll take these one at a time.

So, when we talked in the last year and our quarterly calls about sizing this opportunity, we identified there are just over 30,000 pharmacies that are part of national chains ,there may be another 10,000 small independent and maybe 100,000, physicians offices, all of which could be locations for COVID vaccine storage.

Most of our sales in the last fiscal year were into the national chains of pharmacies. We don't have an exact count of how many of them have vaccine storage. But, the sales that we recognized, based on what our understanding of our market share is that there's probably 30% to 40% of those pharmacies added storage.

We are now seeing orders that indicate that there are storage units going into smaller clinics, physician's offices, maybe some small rural pharmacies, our sales to the distribution channels that service those customers are strong, stronger than they have been in the past. So, we think that that will continue.

This auto defrost unit we're very excited about. There's two messages there. One is, it’s the first patent this business has been issued, and we have a number of new products in the funnel to be released in the coming years. So, we really are making progress on the technology development at Scientific. And this does have enhanced functionality.

It protects vaccines better through the defrost cycle than a typical cabinet. So, this has been part of the sales we've seen in the last year, it's a growing part of our sales. And it has margins that are equivalent to our other margins.

So, this will help the Scientific business continue to deliver the level of margins we've seen in the last few quarters..

Okay. And then, the Jim Hooven is now the President of Engraving and Flavio is the Chief Innovation and Technology Officer. You're looking to fill Jim's old role. How should we think about these moves? Is this a reflection of perhaps you're seeing more opportunity in Engraving, thus the promotion of Jim as President and Flavio as an Innovation Officer.

Perhaps there's something there within that segment that could represent, either product development or adjacent moves within the segment?.

Yes. So, the way we approach is we first look at the growth opportunities that Flavio has been working and the technology developments that are in -- let's say, coming to market.

And we -- those projects have reached a phase, they really need focused attention from Flavio and he has team with him too, 15 to 20 people working in the development group with him that have been incubating these developments.

So, we -- if you look at where Standex has come from in the last few years, this is something we could have not have done a year ago, two years ago, three years ago. We had a lot of portfolio work to do, but you see the power of the higher performing businesses that are part -- that make up our portfolio now.

We have more confidence in our ability to predict our results to lean into some investments. And we frankly have more management time to focus on growth, new technology and meeting with customers about their next generation concepts. So, the first priority was to get this right, get the innovation and the technology right.

Flavio is the perfect guy to run it. Then obviously that leaves that President of Engraving role open.

Fortunately, we brought Jim into the organization a year and a half ago, he has spent a lot of time in the Engraving business, because as you said and as we've talked about, there's a lot of room there for operational improvement and consistency as they drive these concepts of standard work, labor management practices, get the full benefit out of the SAP investment we've made in the last few years.

And, I was fortunate enough to have Jim in the stable on the bench and already close to the business. So, that was an easy move. Now the question is, what do we need now at corporate in that VP ops role? We're still reflecting on that.

As we've talked about Jim and his role in the last year and a half, he's put in place some standard work, some standard scorecards across the business. He has helped beef up the operational teams in our key businesses. So, Electronics has a global operations organization, they've added strategic sourcing, they're adding lean.

We're putting talent on the ground where it needs to be done. In Engraving, obviously, Jim will bring a lot of horsepower to Engraving. So, the role will change a little bit, but there still will be a corporate operations role. And as time goes on here, we'll communicate more specifically what we'll do and what the expectations of that role will be..

Okay. And then, my last question, then I'll hop back in the queue. Within the segment details, you noted some favorable geographical mix.

Can you talk about the business on a geographical basis? What's been changing over the last three to four months? And kind of how do you see that continuing in favor for the Company or what challenges might be out there on a geographic basis?.

Yes. Chris, it's Ademir. We have seen strength across all geographies, if you will. When we talk about geographic mix, it primarily relates to either Electronics or Engraving business and mostly Engraving because our business in Asia or in China is a very profitable business.

So, depending on some of the cycles in that business, that impacts the overall margin for Engraving. That's kind of the reference, when we talk about the regional mix. But overall, we have seen strength across all the regions globally, and especially in the United States, we have benefited from that..

Today's next question comes from Chris McGinnis at Sidoti & Company. Please go ahead..

David, I think just kind of following up on some of the -- maybe last question or the one before that. Just around the strength of the operations as well as the margin profile was due to rationalization of the portfolio.

Could you just talk about the portfolio today and kind of your view around the different segments?.

Yes. It helps to compare it to where we were a few years ago. A few years ago, we had some businesses that just weren't going to meet our expectations. And they competed in different ways that our successful businesses do. They had, depending on the business, relatively weak position in a tough market. And we really had to take some action.

So, we had priorities, entering fiscal years, going back three, four years ago, to divest some of those non-core businesses that were underperforming. Now, if you look at the businesses that we have, in the stable, the seven P&Ls in Standex, there's three of them in the Specialty Solutions Group.

These are all businesses that are somewhere on the spectrum from good to really, really good businesses. And they are holding their own. They have good track records of cash generation and margin generation. So, we're managing them for growth, profit and cash. That doesn't rule out that in the future that we may continue to trim the portfolio.

It would have to be the right price for the right business at the right time. But, right now, a lot of the management attention is directed towards growing these businesses and these terrific opportunities we have in renewable energy, the electrification of the world, smart grids, electric vehicles.

We really have tremendous upside opportunities and are focusing on those things. But, I think the trend will continue, if you look at Standex in the last 10 years and you think over the next 10 years, yes, the likelihood is we'll continue to base the business on a fewer number, fewer larger platforms as we go in the future.

But, we don't have any pressing issues, any pressing businesses that we need to address with the portfolio move..

And then, on the other side, obviously, since you've done successful acquisitions.

Could you just talk about the outlook for any, it’s been a year -- a little over a year I think for the Renco acquisitions?.

Yes. We still have an active funnel and there's a mix in the funnel of privately owned businesses, and -- I should say family owned businesses, they're almost all privately owned, some are PE owned. And I’ve frankly been surprised that fewer of them than I thought have come to market this year. Some that did, as you know, there is no secret.

There's a lot of money out there chasing acquisitions. And we follow the same principles we've laid out in the last few years that these have to be strategic bolt-ons to our core businesses, compete and customer intimacy, have a strong competitive advantage, have clear synergies with our businesses.

And they have to have an attractive return on investment. And some of the businesses we've looked at in this last year and some we got fairly close to, they just -- they didn't hit all those hurdles for a number of reasons..

Okay, great. And then, maybe just one last one with kind of space, form commercialization. Are you aligning those programs, and what are the opportunities that you’ve seen in that marketplace? Thanks..

I'm sorry, Chris, space?.

Yes, just on the space, under space offer, and what happens in that market? Is there an opportunity for you, and can you just talked a little bit about the outlook for that portion of your revenue?.

Yes. I think -- I don't know when the last time we talked about space, but we are on nearly all the current programs. And we're working with the players on next generation. We've listed some of the customers. We're able to talk about others, we have confidentiality agreements with and can't discuss, with them.

But, we see our sales in space in the coming years growing consistently. I think in this last year -- I think we've talked about it last quarter or the quarter before. Let me see I'm looking in cheat sheet here. It's been roughly 40 -- I think, it was about 40% of our business in this last year in our Engineering Technologies business.

And we see solid mid-single-digit growth in this space through our planning horizon..

And ladies and gentlemen, this concludes our question-and-answer session. I'd like to turn the conference back over to management team for any final remarks..

Thank you everybody for joining us today. It's been our pleasure to share our results for the most recent quarter. I want once again to thank the employees of Standex around the world who really stepped up in a very difficult and challenging year through the pandemic and delivered some very strong results that you’ve seen.

It continues to be a pleasure to work with our Board of Directors and our shareholders to help direct Standex to reach our full potential. We look forward to coming back to you next quarter to report on our Q1 results. Thank you..

Thank you, sir. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day..