Forward-looking Statements
This report contains statements that we believe to be "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. All statements, other than statements of historical fact are
forward-looking statements. Without limitation, any statements preceded or
followed by or that include the words "targets," "plans," "believes," "expects,"
"intends," "will," "likely," "may," "anticipates," "estimates," "projects,"
"should," "would," "positioned," "strategy," "future," "forecast" or words,
phrases or terms of similar substance or the negative thereof, are
forward-looking statements. These forward-looking statements are not guarantees
of future performance and are subject to risks, uncertainties, assumptions and
other factors, some of which are beyond our control, which could cause actual
results to differ materially from those expressed or implied by such
forward-looking statements. These factors include adverse effects on our
business operations or financial results, including due to the impact of the
novel coronavirus 2019 ("COVID-19") pandemic and potential impairment of
goodwill and trade names; overall global economic and business conditions
impacting our business; the ability to achieve the benefits of our restructuring
plans; the ability to successfully identify, finance, complete and integrate
acquisitions; competition and pricing pressures in the markets we serve,
including the impacts of tariffs; volatility in currency exchange rates and
commodity prices; inability to generate savings from excellence in operations
initiatives consisting of lean enterprise, supply management and cash flow
practices; increased risks associated with operating foreign businesses; the
ability to deliver backlog and win future project work; failure of markets to
accept new product introductions and enhancements; the impact of changes in laws
and regulations, including those that limit U.S. tax benefits; the outcome of
litigation and governmental proceedings; and the ability to achieve our
long-term strategic operating goals. Additional information concerning these and
other factors is contained in our filings with the U.S. Securities and Exchange
Commission (the "SEC"), including this Quarterly Report on Form 10-Q and ITEM
1A. of our   Annual Report on Form 10-K   for the year ended December 31, 2019.
All forward-looking statements speak only as of the date of this report. nVent
Electric plc assumes no obligation, and disclaims any obligation, to update the
information contained in this report.
Overview
The terms "us," "we," "our," "the Company" or "nVent" refer to nVent Electric
plc. nVent is a leading global provider of electrical connection and protection
solutions. We believe our inventive electrical solutions enable safer systems
and ensure a more secure world. We design, manufacture, market, install and
service high performance products and solutions that connect and protect some of
the world's most sensitive equipment, buildings and critical processes. We offer
a comprehensive range of enclosures, electrical connections and fastening and
thermal management solutions across industry-leading brands that are recognized
globally for quality, reliability and innovation.
We classify our operations into business segments based primarily on types of
products offered and markets served. We operate across three segments:
Enclosures, Electrical & Fastening Solutions and Thermal Management, which
represented approximately 49%, 28% and 23% of total revenues during the first
nine months of 2020, respectively.

•Enclosures-The Enclosures segment provides innovative solutions to connect and protect critical controls systems, electronics, data and electrical equipment. From metallic and non-metallic enclosures to cabinets, subracks and backplanes, it offers the physical infrastructure to host, connect and protect server and network equipment, as well as indoor and outdoor protection for test and measurement, aerospace and defense applications in industrial, infrastructure, energy and commercial verticals.

•Electrical & Fastening Solutions-The Electrical & Fastening Solutions segment provides solutions that connect and protect electrical and mechanical systems and civil structures. Its engineered electrical and fastening products are innovative cost efficient and labor saving connections that are used across a wide range of verticals, including commercial, industrial, infrastructure and energy. •Thermal Management-The Thermal Management segment provides electric thermal solutions that connect and protect critical buildings, infrastructure, industrial processes and people. Its thermal management systems include heat tracing, floor heating, fire-rated and specialty wiring, sensing and snow melting and de-icing solutions for use in industrial, commercial & residential, energy and infrastructure verticals. It's highly reliable and easy to install solutions lower total cost of ownership to building owners, facility managers, operators and end users.


                                       22

--------------------------------------------------------------------------------


  Table of Contents
On April 30, 2018, Pentair plc ("Pentair" or "former Parent") completed the
separation of its Water business and its Electrical business into two
independent, publicly-traded companies (the "separation"). To effect the
separation, Pentair distributed to its shareholders one ordinary share of nVent
for every ordinary share of Pentair held as of the record date of April 17,
2018. As a result of the distribution, nVent is an independent publicly-traded
company and began regular way trading under the symbol "NVT" on the New York
Stock Exchange on May 1, 2018.
On August 30, 2019, as part of our Enclosures segment, we completed the
acquisition of Eldon Holding AB ("Eldon") for $127.8 million, net of cash
acquired. Eldon is an innovative European based manufacturer of enclosures that
protect sensitive electrical, electronic and data and telecommunications
components.
On February 10, 2020, we acquired substantially all of the assets of WBT LLC
("WBT") for approximately $29.9 million in cash. The U.S. based WBT business
manufactures high-quality cable tray systems that will be marketed as part of
the nVent CADDY product line within our Electrical & Fastening Solutions segment
and nVent HOFFMAN product line within our Enclosures segment.

COVID-19

In March 2020, the World Health Organization declared COVID-19 a pandemic. The COVID-19 pandemic has resulted, and is likely to continue to result, in significant economic disruption and has adversely affected, and is likely to continue to adversely affect, our business. Governments around the world have implemented measures to help control the spread of the virus, including business curtailments and shutdowns, isolating residents to their places of residence and restricting travel. Significant uncertainty exists concerning the duration and magnitude of the impact of the COVID-19 pandemic on our business, but the effects of the COVID-19 pandemic have had an unfavorable impact on our business, and we anticipate that the global health crisis and related actions will negatively impact business activity globally. Our top priority remains the safety and well-being of our employees. We have implemented safety and hygiene processes at our manufacturing and distribution locations to help keep our employees safe, including separation of shifts and workstations, temperature monitoring in most locations, and other recommended practices. We have also taken actions to help keep our non-manufacturing employees safe, including: directing employees to work from home, wherever possible, limiting and screening visitors to our facilities, travel restrictions, canceling events that involve large groups of people, encouraging social distancing best practices and enhanced cleaning in our facilities. All of our facilities have a COVID-19 readiness plan, and we have also launched updated wellness programs for employees. We expect to continue to implement these measures until we determine that the COVID-19 pandemic is adequately contained for purposes of our business, and we may take further actions as government authorities require or recommend, or as we determine to be in the best interests of our employees.



We also remain focused on continuing to serve our customers and support critical
industries and essential infrastructure such as medical, data centers and
networking solutions, energy and defense, among others. Government mandated
measures providing for business curtailments or shutdowns have generally
excluded certain essential businesses and services, including businesses that
manufacture and sell products or services that are considered essential to daily
lives, or otherwise operate in essential or critical sectors. While our
facilities are considered essential and have remained operational, during the
third quarter we have experienced intermittent partial closures at certain
facilities as a result of these measures or the need to sanitize the facilities
and address employee well-being. As of the date of this filing, all of our
manufacturing sites are operational and we have not experienced any significant
disruptions to our supply chain. We have experienced and expect to continue to
experience reductions in customer demand in several end-markets across our
business segments. During the second and third quarters of 2020, organic sales
declined by approximately 22% and 14% compared to the same period of the prior
year, respectively, which was primarily attributable to the adverse impacts of
the pandemic.
In response to the adverse effects of the pandemic, we have taken, and expect to
continue to take as appropriate, actions to lower costs, manage our liquidity
and focus on cash flow. These actions have included, but are not limited to:
•Limiting discretionary spending across the organization;
•Reducing payroll costs, which included employee furloughs and temporarily
reducing Board of Director fees and salaries for executive officers and other
senior leaders in the second and third quarters of 2020;
•Temporarily reducing certain discretionary employee benefits;
•Aligning our cost structure to meet demand;
•Reducing capital expenditures;
                                       23

--------------------------------------------------------------------------------


  Table of Contents
•Optimizing working capital through inventory reduction initiatives across
business segments and focused actions to optimize customer and vendor payment
terms; and
•Deferring payment of income and payroll taxes and utilizing job retention
subsidies in certain jurisdictions where such opportunities are available.
In addition to actions taken to lower costs, manage our liquidity and focus on
cash flow, we remain focused on enhancing our digital and technological
capabilities. Our shift to working virtually where possible is allowing us to
accelerate our digital initiatives as we collaborate with customers and
distribution partners to enhance our websites and improve our digital product
content. We are also continuing to invest in our technological capabilities,
with new product launches in the first nine months of 2020, and more expected to
be launched during the balance of this year.
We will continue to actively monitor the impacts of the pandemic and may take
further actions that alter our business operations as may be required by
governments in the jurisdictions where we operate, or that we determine are in
the best interests of our employees, customers, suppliers and shareholders.
Key Trends and Uncertainties Regarding our Existing Business
The following trends and uncertainties affected our financial performance in
2019 and the first nine months of 2020 and will likely impact our results in the
future:
•There are many uncertainties regarding the COVID-19 pandemic, including the
anticipated duration and severity of the pandemic and the extent of worldwide
social, political and economic disruption it may cause. The magnitude of the
impact of the pandemic on our financial condition, liquidity and results of
operations cannot be determined at this time, and ultimately will be affected by
a number of evolving factors including the length of time that the pandemic
continues, its effect on the demand for the Company's products and services and
the supply chain, as well as the impact of governmental regulations imposed in
response to the pandemic including potential business curtailments and shutdowns
impacting our factories. In addition, the recent significant volatility in oil
and gas prices have lead to a potential sustained downturn in the energy
industry.
•We have identified specific product, vertical and geographic opportunities that
we find attractive and continue to pursue, both within and outside the U.S. We
are positioning our businesses to more effectively address these opportunities
through research and development and additional sales and marketing resources.
Unless we successfully penetrate these markets, our organic sales growth will
likely be limited or may decline.
•We have experienced material and other cost inflation. We strive for
productivity improvements, and we implement increases in selling prices to help
mitigate this inflation. We expect the current economic environment, including
the impacts of tariffs, will result in continuing price volatility for many of
our raw materials and purchased components, and we are uncertain as to the
timing and impact of these market changes.
•During 2019 and the first nine months of 2020, we continued execution of
certain business restructuring initiatives aimed at reducing our fixed cost
structure and realigning our business. Specifically in the first nine months of
2020, certain initiatives were executed in response to the decrease in demand
attributed to the effect of the COVID-19 pandemic.
In addition to the actions and objectives discussed in the Overview and COVID-19
sections above, our operating objectives in 2020 also include the following:
•Achieving differentiated revenue growth through new products and solutions and
vertical expansion in key developing regions;
•Driving operating excellence through lean enterprise initiatives, with specific
focus on sourcing and supply management, cash flow management and lean
operations;
•Optimizing our technological capabilities to increasingly generate innovative
new and connected products and advance digital transformation; and
•Focusing on developing global talent in light of our global presence.
                                       24

--------------------------------------------------------------------------------

Table of Contents

© Edgar Online, source Glimpses