Applied Industrial Technologies, Inc. (NYSE:AIT) Q4 2019 Earnings Conference Call - Final Transcript
Aug 14, 2019 • 10:00 am ET
Neil A. Schrimsher
environment industry wide and deliver solid margins, record EBITDA and notable free cash improvement. This is despite ongoing inflationary headwinds, demonstrating our cost discipline, flexible business model and benefits from various self-help initiatives that remain ongoing.
Consistent with the recent macroeconomic industrial reports, we saw a slowdown in demand across a number of our end markets during the quarter. This was most notable in heavy machinery, mining, oil and gas, and process-related industries. While the industrial backdrop is proving more challenging near-term, we see sustained momentum from our industry position, operational strategy and cash generation potential. This leaves us well positioned as the cycle evolves.
In addition, throughout the organization, our expanding capabilities and enhanced differentiation are yielding results in the form of new opportunities that positively impact our market position and customer base, providing material contributions to the future growth of Applied. We further accelerate our differentiation through targeted acquisitions that build on our capabilities to expand with new and current customers.
Just announced this morning, we've signed a definitive agreement to acquire Olympus Controls, an automation solutions provider, with five locations and annual sales of approximately $45 million. Olympus offers a full range of value-added automation expertise for OEMs, machine builders, integrators and end-users from design, assembly and integration to the distribution of motion control, machine vision and robotic technologies. Their addition is a strong complement to our business, further broadening our capabilities, customer opportunities and technical presence across varied industrial segments.
Overall, this is an exciting transaction for us. Olympus is best in class in machine robotic automation and provides a strong platform to further enhance our value proposition and growth profile long term. We welcome them to our Company and look forward to their contribution.
Additionally, we see emerging opportunities to expand our innovative solutions for the industrial Internet of Things. Given our technical industry position, engineered solutions and supplier relationships, delivering expertise that improves efficiency and boost productivity is key and we look forward to enhancing these comprehensive solutions for increased customer and shareholder value.
Now, at this time, I'll turn the call over to Dave for additional detail on our financial results.
David K. Wells
Thanks Neil, and good morning, everyone. Another reminder, there is supplemental investor deck recapping key financial and performance talking points is available on our investors site.
To summarize fiscal fourth quarter performance, sales trend slowed, reflecting a broad weakening across our end markets. However, we executed well in this softer environment, reinforced our cost discipline and improved margins, EBITDA and free cash generation.
To provide more detail, consolidated sales decreased 1.7% over the prior year. Acquisitions contributed 2.2% growth, while foreign currency lowered sales by 0.4% and the difference in selling days was a negative 0.8% impact. Netting these factors, sales decreased 2.7% on an organic daily basis. As Neil mentioned, we saw a slowdown across a number of key end markets during the quarter, which we believe is indicative of more disciplined customer spending and lower project activity following a strong