Parker Reports Fiscal 2025 First Quarter Results

GlobeNewswire Inc.

October 31, 2024 11:31AM GMT

Record sales, segment operating margin and earnings per share; EPS outlook increased

CLEVELAND, Oct. 31, 2024 (GLOBE NEWSWIRE) -- Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today reported results for the quarter ended September 30, 2024, that included the following highlights (compared with the prior year quarter):

Fiscal 2025 First Quarter Highlights:

  • Sales increased 1.2% to $4.9 billion; Organic sales growth was 1.4%
  • Net income was $698 million, an increase of 7%, or $810 million adjusted, an increase of 4%
  • EPS were $5.34, an increase of 7%, or $6.20 adjusted, an increase of 4%
  • Segment operating margin was 22.6%, an increase of 130 bps, or a record 25.7% adjusted, an increase of 80 bps
  • Cash flow from operations was 15.2% of sales, an increase of 14% to $744 million

“Through continued execution of The Win Strategy™, our global team produced outstanding results in the first quarter,” said Chairman and Chief Executive Officer, Jenny Parmentier. “We delivered records for sales, adjusted segment operating margin, adjusted earnings per share and year-to-date cash flow from operations. Our performance also reflects the strength of our transformed portfolio with our Aerospace Systems segment achieving exceptional results. Looking ahead to the full year, we anticipate near-term pressure in select industrial markets and accelerating growth in aerospace. Reflecting these conditions and our strong first quarter performance, we have raised our outlook for segment operating margin and earnings per share. We remain committed to our fiscal 2029 targets and continue to see a very promising future for Parker.”

This news release contains non-GAAP financial measures. Reconciliations of adjusted numbers and certain non-GAAP financial measures are included in the financial tables of this press release.

Outlook

Guidance for the fiscal year ending June 30, 2025 has been updated. Guidance now reflects divestiture activity in the Diversified Industrial Segment, North America Businesses expected to be completed during the second quarter of fiscal 2025. The company now expects:

  • Total sales growth in fiscal 2025 of 0.5% to 3.5%, with organic sales growth of 1.5% to 4.5%; divestitures of (1.5%) and favorable currency of 0.5%
  • Total segment operating margin to increase to approximately 22.6%, or approximately 25.7% on an adjusted basis
  • EPS to increase to $22.78 to $23.48, or $26.35 to $27.05 on an adjusted basis

Segment Results

Diversified Industrial Segment

North America Businesses

 

 

 

 

 

 

 

$ in mm

 

 

 

 

 

 

 

 

FY25 Q1

 

FY24 Q1

 

Change

 

Organic Growth

Sales

$

2,100

 

 

$

2,230

 

 

-5.8

%

 

-5.0

%

Segment Operating Income

$

485

 

 

$

506

 

 

-4.2

%

 

 

Segment Operating Margin

 

23.1

%

 

 

22.7

%

 

40 bps

 

 

Adjusted Segment Operating Income

$

532

 

 

$

554

 

 

-4.1

%

 

 

Adjusted Segment Operating Margin

 

25.3

%

 

 

24.9

%

 

40 bps

 

 

  • Achieved record adjusted segment operating margin
  • HVAC returns to growth, while delays impact in-plant and energy markets
  • Softness continues in transportation and off-highway markets

International Businesses

 

 

 

$ in mm

 

 

 

 

 

 

 

 

FY25 Q1

 

FY24 Q1

 

Change

 

Organic Growth

Sales

$

1,356

 

 

$

1,389

 

 

-2.4

%

 

-2.4

%

Segment Operating Income

$

299

 

 

$

301

 

 

-0.6

%

 

 

Segment Operating Margin

 

22.1

%

 

 

21.7

%

 

40 bps

 

 

Adjusted Segment Operating Income

$

327

 

 

$

334

 

 

-2.2

%

 

 

Adjusted Segment Operating Margin

 

24.1

%

 

 

24.1

%

 

—         bps

 

 

  • Achieved record adjusted segment operating margin
  • Positive sales growth in Asia, offset by continued softness in Europe

Aerospace Systems Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

$ in mm

 

FY25 Q1

 

FY24 Q1

 

Change

 

Organic Growth

Sales

$

1,448

 

 

$

1,229

 

 

17.8

%

 

17.2

%

Segment Operating Income

$

323

 

 

$

226

 

 

42.7

%

 

 

Segment Operating Margin

 

22.3

%

 

 

18.4

%

 

390 bps

 

 

Adjusted Segment Operating Income

$

403

 

 

$

320

 

 

26.3

%

 

 

Adjusted Segment Operating Margin

 

27.9

%

 

 

26.0

%

 

190 bps

 

 

  • Achieved record sales and adjusted segment operating margin
  • Outstanding aftermarket sales growth in both commercial and defense markets

Order Rates

 

FY25 Q1

 

 

Parker

+1

%

 

Diversified Industrial Segment - North America Businesses

-3

%

 

Diversified Industrial Segment - International Businesses

+1

%

 

Aerospace Systems Segment

+7

%

 

  • Company order rates continue to be positive
  • International orders turned positive on Asia improvement
  • Aerospace orders remained strong against a tough prior year comparison

About Parker Hannifin
Parker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Learn more at www.parker.com or @parkerhannifin.

Contacts:

 

Media:

Financial Analysts:

Aidan Gormley

Jeff Miller

216-896-3258

216-896-2708

aidan.gormley@parker.com

jeffrey.miller@parker.com

Notice of Webcast
Parker Hannifin's conference call and slide presentation to discuss its fiscal 2025 first quarter results are available to all interested parties via live webcast today at 11:00 a.m. ET, at investors.parker.com. A replay of the webcast will be available on the site approximately one hour after the completion of the call and will remain available for one year. To register for e-mail notification of future events please visit investors.parker.com.

Note on Orders The company reported orders for the quarter ending September 30, 2024, compared with the same quarter a year ago. All comparisons are at constant currency exchange rates, with the prior year quarter restated to the current-year rates. Diversified Industrial comparisons are on 3-month average computations and Aerospace Systems comparisons are on rolling 12-month average computations.

Note on Non-GAAP Financial Measures
This press release contains references to non-GAAP financial information including (a) adjusted net income; (b) adjusted earnings per share; (c) adjusted operating margin and segment operating margins; (d) adjusted operating income and segment operating income and (e) organic sales growth. The adjusted net income, adjusted earnings per share, adjusted operating margin, adjusted segment operating margin, adjusted operating income, adjusted segment operating income and organic sales measures are presented to allow investors and the company to meaningfully evaluate changes in net income, earnings per share and segment operating margins on a comparable basis from period to period. Although adjusted net income, adjusted earnings per share, adjusted operating margin and segment operating margins, adjusted operating income and segment operating income, and organic sales growth are not measures of performance calculated in accordance with GAAP, we believe that they are useful to an investor in evaluating the results of this quarter versus the prior period. Comparable descriptions of record adjusted results in this release refer only to the period from the first quarter of FY2011 to the periods presented in this release. This period coincides with recast historical financial results provided in association with our FY2014 change in segment reporting. A reconciliation of non-GAAP measures is included in the financial tables of this press release.

Forward-Looking Statements
Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance.

Among other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics. Readers should also consider forward-looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and other periodic filings made with the SEC.

CONSOLIDATED STATEMENT OF INCOME

 

 

 

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands, except per share amounts)

 

2024

 

 

 

2023

 

Net sales

 

$

4,903,984

 

 

$

4,847,488

 

Cost of sales

 

 

3,097,719

 

 

 

3,097,349

 

Selling, general and administrative expenses

 

848,789

 

 

 

873,691

 

Interest expense

 

 

113,091

 

 

 

134,468

 

Other income, net

 

 

(30,801

)

 

 

(78,455

)

Income before income taxes

 

 

875,186

 

 

 

820,435

 

Income taxes

 

 

176,658

 

 

 

169,363

 

Net income

 

 

698,528

 

 

 

651,072

 

Less: Noncontrolling interests

 

 

108

 

 

 

245

 

Net income attributable to common shareholders

$

698,420

 

 

$

650,827

 

 

 

 

 

 

Earnings per share attributable to common shareholders:

 

 

 

Basic earnings per share

 

$

5.43

 

 

$

5.07

 

Diluted earnings per share

 

$

5.34

 

 

$

4.99

 

 

 

 

 

 

Average shares outstanding during period - Basic

 

128,663,088

 

 

 

128,472,550

 

Average shares outstanding during period - Diluted

 

130,680,242

 

 

 

130,363,441

 

 

 

 

 

 

 

 

 

 

 

CASH DIVIDENDS PER COMMON SHARE

 

 

 

(Unaudited)

 

Three Months Ended September 30,

(Amounts in dollars)

 

 

2024

 

 

 

2023

 

Cash dividends per common share

$

1.63

 

 

$

1.48

 

RECONCILIATION OF ORGANIC GROWTH

 

 

 

 

 

 

(Unaudited)

Three Months Ended

 

As Reported

 

 

 

 

 

Adjusted

 

September 30, 2024

 

Currency

 

Divestitures

 

September 30, 2024

Diversified Industrial Segment

(4.5)%

 

(0.3)%

 

(0.2)%

 

(4.0)%

Aerospace Systems Segment

17.8

%

 

0.6

%

 

 

—%

 

17.2

%

Total

1.2

%

 

%

 

(0.2)%

 

1.4

%

RECONCILIATION OF NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS TO ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

 

2023

 

Net income attributable to common shareholders

$

698,420

 

 

$

650,827

 

Adjustments:

 

 

 

Acquired intangible asset amortization expense

 

140,121

 

 

 

155,520

 

Business realignment charges

 

9,506

 

 

 

13,092

 

Integration costs to achieve

 

 

6,411

 

 

 

6,406

 

Gain on sale of building

 

(10,461

)

 

 

 

Gain on divestiture

 

 

 

 

(13,260

)

Tax effect of adjustments

1

 

 

(34,211

)

 

 

(36,148

)

Adjusted net income attributable to common shareholders

$

809,786

 

 

$

776,437

 

RECONCILIATION OF EARNINGS PER DILUTED SHARE TO ADJUSTED EARNINGS PER DILUTED SHARE

(Unaudited)

 

Three Months Ended September 30,

(Amounts in dollars)

 

 

2024

 

 

 

2023

 

Earnings per diluted share

$

5.34

 

 

$

4.99

 

Adjustments:

 

 

 

Acquired intangible asset amortization expense

 

1.07

 

 

 

1.19

 

Business realignment charges

 

0.07

 

 

 

0.10

 

Integration costs to achieve

 

0.05

 

 

 

0.05

 

Gain on sale of building

 

(0.08

)

 

 

 

Gain on divestiture

 

 

 

 

(0.10

)

Tax effect of adjustments

1

 

 

(0.25

)

 

 

(0.27

)

Adjusted earnings per diluted share

$

6.20

 

 

$

5.96

 

 

 

 

 

 

1

This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.

BUSINESS SEGMENT INFORMATION

 

 

 

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

2023

Net sales

 

 

 

 

Diversified Industrial

 

$

3,456,158

 

$

3,618,528

Aerospace Systems

 

 

1,447,826

 

 

1,228,960

Total net sales

 

$

4,903,984

 

$

4,847,488

Segment operating income

 

 

 

 

Diversified Industrial

 

$

783,546

 

$

806,754

Aerospace Systems

 

 

322,986

 

 

226,260

Total segment operating income

 

1,106,532

 

 

1,033,014

Corporate general and administrative expenses

 

48,794

 

 

55,656

Income before interest expense and other expense, net

 

1,057,738

 

 

977,358

Interest expense

 

 

113,091

 

 

134,468

Other expense, net

 

 

69,461

 

 

22,455

Income before income taxes

 

$

875,186

 

$

820,435

RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

 

2023

 

Diversified Industrial Segment sales

 

$

3,456,158

 

 

$

3,618,528

 

 

 

 

 

 

Diversified Industrial Segment operating income

 

$

783,546

 

 

$

806,754

 

Adjustments:

 

 

 

 

Acquired intangible asset amortization

 

 

65,264

 

 

 

67,951

 

Business realignment charges

 

 

8,900

 

 

 

12,639

 

Integration costs to achieve

 

 

778

 

 

 

1,139

 

Adjusted Diversified Industrial Segment operating income

 

$

858,488

 

 

$

888,483

 

 

 

 

 

 

Diversified Industrial Segment operating margin

 

 

22.7

%

 

 

22.3

%

Adjusted Diversified Industrial Segment operating margin

 

 

24.8

%

 

 

24.6

%

 

 

 

 

 

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

 

2023

 

Aerospace Systems Segment sales

 

$

1,447,826

 

 

$

1,228,960

 

 

 

 

 

 

Aerospace Systems Segment operating income

 

$

322,986

 

 

$

226,260

 

Adjustments:

 

 

 

 

Acquired intangible asset amortization

 

 

74,857

 

 

 

87,569

 

Business realignment charges

 

 

8

 

 

 

453

 

Integration costs to achieve

 

 

5,633

 

 

 

5,267

 

Adjusted Aerospace Systems Segment operating income

 

$

403,484

 

 

$

319,549

 

 

 

 

 

 

Aerospace Systems Segment operating margin

 

 

22.3

%

 

 

18.4

%

Adjusted Aerospace Systems Segment operating margin

 

 

27.9

%

 

 

26.0

%

 

 

 

 

 

RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

 

2023

 

Total net sales

 

$

4,903,984

 

 

$

4,847,488

 

 

 

 

 

 

Total segment operating income

 

$

1,106,532

 

 

$

1,033,014

 

Adjustments:

 

 

 

 

Acquired intangible asset amortization

 

 

140,121

 

 

 

155,520

 

Business realignment charges

 

 

8,908

 

 

 

13,092

 

Integration costs to achieve

 

 

6,411

 

 

 

6,406

 

Adjusted total segment operating income

 

$

1,261,972

 

 

$

1,208,032

 

 

 

 

 

 

Total segment operating margin

 

 

22.6

%

 

 

21.3

%

Adjusted total segment operating margin

 

 

25.7

%

 

 

24.9

%

CONSOLIDATED BALANCE SHEET

 

 

 

(Unaudited)

 

September 30,

 

June 30,

(Dollars in thousands)

 

 

2024

 

 

2024

Assets

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

371,068

 

$

422,027

Trade accounts receivable, net

 

 

2,712,656

 

 

2,865,546

Non-trade and notes receivable

 

 

317,381

 

 

331,429

Inventories

 

 

2,872,250

 

 

2,786,800

Prepaid expenses

 

 

249,148

 

 

252,618

Other current assets

 

 

511,198

 

 

140,204

Total current assets

 

 

7,033,701

 

 

6,798,624

Property, plant and equipment, net

 

 

2,839,542

 

 

2,875,668

Deferred income taxes

 

 

91,882

 

 

92,704

Investments and other assets

 

 

1,263,190

 

 

1,207,232

Intangible assets, net

 

 

7,747,233

 

 

7,816,181

Goodwill

 

 

10,625,287

 

 

10,507,433

Total assets

 

$

29,600,835

 

$

29,297,842

 

 

 

 

 

Liabilities and equity

 

 

 

 

Current liabilities:

 

 

 

 

Notes payable and long-term debt payable within one year

 

$

3,515,613

 

$

3,403,065

Accounts payable, trade

 

 

1,953,477

 

 

1,991,639

Accrued payrolls and other compensation

 

 

407,106

 

 

581,251

Accrued domestic and foreign taxes

 

 

457,761

 

 

354,659

Other accrued liabilities

 

 

1,004,073

 

 

982,695

Total current liabilities

 

 

7,338,030

 

 

7,313,309

Long-term debt

 

 

6,673,303

 

 

7,157,034

Pensions and other postretirement benefits

 

 

427,702

 

 

437,490

Deferred income taxes

 

 

1,544,503

 

 

1,583,923

Other liabilities

 

 

715,948

 

 

725,193

Shareholders' equity

 

 

12,891,900

 

 

12,071,972

Noncontrolling interests

 

 

9,449

 

 

8,921

Total liabilities and equity

 

$

29,600,835

 

$

29,297,842

CONSOLIDATED STATEMENT OF CASH FLOWS

 

 

 

 

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

 

2023

 

Cash flows from operating activities:

 

 

 

 

Net income

 

$

698,528

 

 

$

651,072

 

Depreciation and amortization

 

 

229,046

 

 

 

240,387

 

Stock incentive plan compensation

 

 

75,842

 

 

 

77,894

 

Gain on sale of businesses

 

 

(313

)

 

 

(13,260

)

(Gain) loss on property, plant and equipment and intangible assets

 

 

(8,422

)

 

 

1,333

 

Net change in receivables, inventories and trade payables

 

 

(40,430

)

 

 

(69,280

)

Net change in other assets and liabilities

 

 

(223,585

)

 

 

(185,691

)

Other, net

 

 

13,309

 

 

 

(52,496

)

Net cash provided by operating activities

 

 

743,975

 

 

 

649,959

 

Cash flows from investing activities:

 

 

 

 

Capital expenditures

 

 

(95,302

)

 

 

(97,746

)

Proceeds from sale of property, plant and equipment

 

 

13,271

 

 

 

710

 

Proceeds from sale of businesses

 

 

884

 

 

 

36,691

 

Other, net

 

 

(5,461

)

 

 

4,351

 

Net cash used in investing activities

 

 

(86,608

)

 

 

(55,994

)

Cash flows from financing activities:

 

 

 

 

Net payments for common stock activity

 

 

(92,089

)

 

 

(78,148

)

Acquisition of noncontrolling interests

 

 

 

 

 

(2,883

)

Net payments for debt

 

 

(408,929

)

 

 

(346,411

)

Dividends paid

 

 

(209,937

)

 

 

(190,420

)

Net cash used in financing activities

 

 

(710,955

)

 

 

(617,862

)

Effect of exchange rate changes on cash

 

 

2,629

 

 

 

(2,359

)

Net decrease in cash and cash equivalents

 

 

(50,959

)

 

 

(26,256

)

Cash and cash equivalents at beginning of year

 

 

422,027

 

 

 

475,182

 

Cash and cash equivalents at end of period

 

$

371,068

 

 

$

448,926

 

RECONCILIATION OF FORECASTED ORGANIC GROWTH

 

(Unaudited)

 

 

(Amounts in percentages)

 

Fiscal Year 2025

Forecasted net sales

 

0.5% to 3.5%

Adjustments:

 

 

Currency

 

(0.5)%

Divestitures

 

1.5%

Adjusted forecasted net sales

 

1.5% to 4.5%

 

 

 

RECONCILIATION OF FORECASTED SEGMENT OPERATING MARGIN TO ADJUSTED FORECASTED SEGMENT OPERATING MARGIN

 

 

 

(Unaudited)

 

 

(Amounts in percentages)

 

Fiscal Year 2025

Forecasted segment operating margin

~22.6%

Adjustments:

 

Business realignment charges

0.2%

Costs to achieve

 

0.1%

Acquisition-related intangible asset amortization expense

 

2.7%

Adjusted forecasted segment operating margin

~25.7%

RECONCILIATION OF FORECASTED EARNINGS PER DILUTED SHARE TO ADJUSTED FORECASTED EARNINGS PER DILUTED SHARE

 

 

 

(Unaudited)

 

 

(Amounts in dollars)

 

Fiscal Year 2025

Forecasted earnings per diluted share

$22.78 to $23.48

Adjustments:

 

Business realignment charges

0.39

Costs to achieve

 

0.11

Acquisition-related intangible asset amortization expense

 

4.21

Gain on sale of building

 

(0.08)

Tax effect of adjustments

1

 

(1.07)

Adjusted forecasted earnings per diluted share

$26.35 to $27.05

 

 

 

1

This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.

 

 

 

Note: Totals may not foot due to rounding

SUPPLEMENTAL INFORMATION

BUSINESS SEGMENT INFORMATION

 

 

 

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

2023

Net sales

 

 

 

 

Diversified Industrial:

 

 

 

 

North America businesses

 

$

2,100,324

 

$

2,229,906

International businesses

 

 

1,355,834

 

 

1,388,622

 

 

 

 

 

Segment operating income

 

 

 

Diversified Industrial:

 

 

 

 

North America businesses

 

$

484,563

 

$

506,053

International businesses

 

 

298,983

 

 

300,701

RECONCILIATION OF ORGANIC GROWTH

 

 

 

 

(Unaudited)

Three Months Ended

 

As Reported

 

 

 

 

 

Adjusted

 

September 30, 2024

 

Currency

 

Divestitures

 

September 30, 2024

Diversified Industrial Segment:

 

 

 

 

 

 

 

North America businesses

(5.8)%

 

(0.5)%

 

(0.3)%

 

(5.0)%

International businesses

(2.4)%

 

 

—%

 

 

—%

 

(2.4)%

RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

 

2023

 

Diversified Industrial Segment:

 

 

 

 

North America businesses sales

 

$

2,100,324

 

 

$

2,229,906

 

 

 

 

 

 

North America businesses operating income

 

$

484,563

 

 

$

506,053

 

Adjustments:

 

 

 

 

Acquired intangible asset amortization

 

 

42,975

 

 

 

44,683

 

Business realignment charges

 

 

3,444

 

 

 

2,584

 

Integration costs to achieve

 

 

605

 

 

 

945

 

Adjusted North America businesses operating income

 

$

531,587

 

 

$

554,265

 

 

 

 

 

 

North America businesses operating margin

 

 

23.1

%

 

 

22.7

%

Adjusted North America businesses operating margin

 

 

25.3

%

 

 

24.9

%

 

 

 

 

 

(Unaudited)

 

Three Months Ended September 30,

(Dollars in thousands)

 

 

2024

 

 

 

2023

 

Diversified Industrial Segment:

 

 

 

 

International businesses sales

 

$

1,355,834

 

 

$

1,388,622

 

 

 

 

 

 

International businesses operating income

 

$

298,983

 

 

$

300,701

 

Adjustments:

 

 

 

 

Acquired intangible asset amortization

 

 

22,289

 

 

 

23,268

 

Business realignment charges

 

 

5,456

 

 

 

10,055

 

Integration costs to achieve

 

 

173

 

 

 

194

 

Adjusted International businesses operating income

 

$

326,901

 

 

$

334,218

 

 

 

 

 

 

International businesses operating margin

 

 

22.1

%

 

 

21.7

%

Adjusted International businesses operating margin

 

 

24.1

%

 

 

24.1

%