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Knowles (KN) investor relations material
Knowles 17th Annual Southwest IDEAS Conference summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Business overview and transformation
Operates in two segments: Precision Devices (56%-57% of 2024 revenue) and MSA (microphones/receivers for hearing health).
Medtech, defense, and industrial are the primary end markets, with medtech comprising about half of the business.
Completed a major transformation by divesting the consumer electronics business in December 2023, focusing on higher-margin, growth-oriented segments.
Portfolio now consists of attractive margin businesses with no further divestitures planned.
Financial performance and targets
Revenue CAGR of 8% from 2017 to 2024, with EBITDA CAGR at 11% due to margin expansion and operating leverage.
EBITDA margins currently at 24%, targeting 30% within three to five years.
Growth strategy includes 4%-6% organic growth and 4% from acquisitions, aiming for 8%-10% annual revenue growth.
Precision Devices expected to grow 6%-8%, while medtech and specialty audio grow at GDP plus.
Growth drivers and market trends
Precision Devices benefits from global energy demand, AI, automation, and alternative energy applications.
Secured a $75 million alternative energy order, with deliveries ramping up through 2027.
Medical capacitor applications (MRI, pacemakers, defibrillators) expected to grow 3%-5% annually.
Defense segment supported by long-term programs like SPICE 6 for Navy radar upgrades.
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