ESAB Corporation Announces Fourth Quarter 2023 Results and Initiates Full Year 2024 Guidance
- Record fourth quarter sales and margin performance
- Sales and core organic growth up 4%
-
Reported operating income of
$104 million and core adjusted EBITDA of$126 million , up 18% versus prior year - Initiated full year 2024 outlook
“ESAB’s team continues to execute well and delivered record-breaking sales, profit, and cash flow during the fourth quarter to conclude the year. Our exciting new innovative products are driving growth and EBX initiatives are expanding margins and generating strong cash flow," stated
Conference Call and Webcast
The Company will hold a conference call to discuss its fourth quarter 2023 results beginning at
About
Founded in 1904,
Non-GAAP Financial Measures and Other Adjustments
Adjusted net income from continuing operations represents Net income from continuing operations, excluding Restructuring and other related charges, acquisition-amortization and other related charges, separation costs and pension settlement gains. Adjusted net income includes the tax effect of non-GAAP adjusting items at applicable tax rates.
Adjusted EBITDA, excludes from Net income from continuing operations, the effect of Income tax expense, Interest expense (income) and other, net, Pension settlement gains, Restructuring and other related charges, separation costs, acquisition-amortization and other related charges and depreciation and other amortization.
Adjusted free cash flow represents cash flows from operating activities excluding cash outflows related to the Company’s separation from Enovis Corporation and discontinued operations, less Purchases of property, plant and equipment net proceeds from sale of certain properties. Cash conversion represents Adjusted free cash flow divided by Adjusted net income from continuing operations.
These non-GAAP financial measures assist
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information calculated in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of non-GAAP financial measures presented above to GAAP results has been provided in the financial tables included in this press release.
Forward Looking Statements
This press release includes forward-looking statements, including forward-looking statements within the meaning of the
CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS Dollars in thousands, except per share data (Unaudited) |
|||||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net sales |
$ |
689,348 |
|
|
$ |
664,127 |
|
|
$ |
2,774,766 |
|
|
$ |
2,593,480 |
|
Cost of sales |
|
434,623 |
|
|
|
439,738 |
|
|
|
1,759,015 |
|
|
|
1,707,950 |
|
Gross profit |
|
254,725 |
|
|
|
224,389 |
|
|
|
1,015,751 |
|
|
|
885,530 |
|
Selling, general and administrative expense |
|
144,639 |
|
|
|
139,343 |
|
|
|
587,475 |
|
|
|
533,369 |
|
Restructuring and other related charges |
|
6,368 |
|
|
|
6,467 |
|
|
|
24,110 |
|
|
|
23,096 |
|
Operating income |
|
103,718 |
|
|
|
78,579 |
|
|
|
404,166 |
|
|
|
329,065 |
|
Pension settlement gain |
|
— |
|
|
|
(5,836 |
) |
|
|
— |
|
|
|
(9,136 |
) |
Interest expense (income) and other, net |
|
26,243 |
|
|
|
18,434 |
|
|
|
85,074 |
|
|
|
37,950 |
|
Income from continuing operations before income taxes |
|
77,475 |
|
|
|
65,981 |
|
|
|
319,092 |
|
|
|
300,251 |
|
Income tax expense |
|
17,921 |
|
|
|
5,541 |
|
|
|
95,727 |
|
|
|
69,170 |
|
Net income from continuing operations |
|
59,554 |
|
|
|
60,440 |
|
|
|
223,365 |
|
|
|
231,081 |
|
(Loss) income from discontinued operations, net of taxes |
|
(8,082 |
) |
|
|
1,830 |
|
|
|
(12,341 |
) |
|
|
(3,068 |
) |
Net income |
|
51,472 |
|
|
|
62,270 |
|
|
|
211,024 |
|
|
|
228,013 |
|
Less: Income attributable to noncontrolling interest, net of taxes |
|
1,233 |
|
|
|
1,563 |
|
|
|
5,739 |
|
|
|
4,266 |
|
Net income attributable to |
$ |
50,239 |
|
|
$ |
60,707 |
|
|
$ |
205,285 |
|
|
$ |
223,747 |
|
Earnings (loss) per share – basic |
|
|
|
|
|
|
|
||||||||
Income from continuing operations |
$ |
0.96 |
|
|
$ |
0.97 |
|
|
$ |
3.59 |
|
|
$ |
3.75 |
|
Income (loss) on discontinued operations |
$ |
(0.13 |
) |
|
$ |
0.03 |
|
|
$ |
(0.20 |
) |
|
$ |
(0.05 |
) |
Net income per share |
$ |
0.83 |
|
|
$ |
1.00 |
|
|
$ |
3.39 |
|
|
$ |
3.70 |
|
Earnings (loss) per share – diluted |
|
|
|
|
|
|
|
||||||||
Income from continuing operations |
$ |
0.96 |
|
|
$ |
0.97 |
|
|
$ |
3.56 |
|
|
$ |
3.74 |
|
Income (loss) on discontinued operations |
$ |
(0.13 |
) |
|
$ |
0.03 |
|
|
$ |
(0.20 |
) |
|
$ |
(0.05 |
) |
Net income per share – diluted |
$ |
0.83 |
|
|
$ |
1.00 |
|
|
$ |
3.36 |
|
|
$ |
3.69 |
|
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES Dollars in millions, except per share data (Unaudited) |
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|
Three Months Ended |
|
Year Ended |
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|
|
|
|
|
|
|
|
||||||||
Adjusted Net Income |
(Dollars in millions)(1) |
||||||||||||||
Net income from continuing operations (GAAP) |
$ |
59.6 |
|
|
$ |
60.4 |
|
|
$ |
223.4 |
|
|
$ |
231.1 |
|
Less: Income attributable to noncontrolling interest, net of taxes |
|
1.2 |
|
|
|
1.6 |
|
|
|
5.7 |
|
|
|
4.3 |
|
Net income from continuing operations attributable to |
$ |
58.4 |
|
|
$ |
58.9 |
|
|
$ |
217.7 |
|
|
$ |
226.8 |
|
Restructuring and other related charges – pretax(2) |
|
6.4 |
|
|
|
6.5 |
|
|
|
24.1 |
|
|
|
23.1 |
|
Acquisition - amortization and other related charges – pretax(3) |
|
9.0 |
|
|
|
11.7 |
|
|
|
36.9 |
|
|
|
34.2 |
|
Separation costs – pretax(4) |
|
— |
|
|
|
6.6 |
|
|
|
— |
|
|
|
16.3 |
|
Pension settlement gain – pretax |
|
— |
|
|
|
(5.8 |
) |
|
|
— |
|
|
|
(9.1 |
) |
Tax effect on the above items(5) |
|
(3.7 |
) |
|
|
(6.8 |
) |
|
|
(14.7 |
) |
|
|
(15.2 |
) |
Discrete tax adjustments(6) |
|
0.7 |
|
|
|
(3.5 |
) |
|
|
20.8 |
|
|
|
(7.2 |
) |
Adjusted net income from continuing operations (non-GAAP) |
$ |
70.8 |
|
|
$ |
67.6 |
|
|
$ |
284.8 |
|
|
$ |
268.9 |
|
Adjusted net income from continuing operations attributable to |
|
2.1 |
|
|
|
3.5 |
|
|
|
12.9 |
|
|
|
19.2 |
|
Core adjusted net income from continuing operations (non-GAAP) |
$ |
68.7 |
|
|
$ |
64.1 |
|
|
$ |
271.8 |
|
|
$ |
249.7 |
|
Adjusted net income margin from continuing operations |
|
10.3 |
% |
|
|
10.2 |
% |
|
|
10.3 |
% |
|
|
10.4 |
% |
|
|
|
|
|
|
|
|
||||||||
Adjusted Net Income Per Share |
|
|
|
|
|
|
|
||||||||
Net income per share - diluted from continuing operations (GAAP) |
$ |
0.96 |
|
|
$ |
0.97 |
|
|
$ |
3.56 |
|
|
$ |
3.74 |
|
Restructuring and other related charges – pretax(2) |
|
0.10 |
|
|
|
0.11 |
|
|
|
0.40 |
|
|
|
0.38 |
|
Acquisition - amortization and other related charges – pretax(3) |
|
0.15 |
|
|
|
0.19 |
|
|
|
0.61 |
|
|
|
0.57 |
|
Separation costs – pretax(4) |
|
— |
|
|
|
0.11 |
|
|
|
— |
|
|
|
0.27 |
|
Pension settlement gain – pretax |
|
— |
|
|
|
(0.10 |
) |
|
|
— |
|
|
|
(0.15 |
) |
Tax effect on the above items(5) |
|
(0.06 |
) |
|
|
(0.11 |
) |
|
|
(0.24 |
) |
|
|
(0.25 |
) |
Discrete tax adjustments(6) |
|
0.01 |
|
|
|
(0.06 |
) |
|
|
0.34 |
|
|
|
(0.12 |
) |
Adjusted net income per share - diluted from continuing operations (non-GAAP) |
$ |
1.16 |
|
|
$ |
1.11 |
|
|
$ |
4.67 |
|
|
$ |
4.44 |
|
Adjusted net income per share - diluted from continuing operations attributable to |
|
0.03 |
|
|
|
0.06 |
|
|
|
0.21 |
|
|
|
0.32 |
|
Core adjusted net income per share - diluted from continuing operations (non-GAAP) |
|
1.13 |
|
|
|
1.05 |
|
|
|
4.46 |
|
|
|
4.12 |
|
__________ |
|
(1) |
Numbers may not sum due to rounding. |
(2) |
Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, and other costs in connection with the closure and optimization of facilities and product lines. |
(3) |
Includes transaction expenses, amortization of intangibles, fair value charges on acquired inventories and integration expenses. |
(4) |
Includes non-recurring charges and employee costs related to the planning and execution of the separation from Enovis. |
(5) |
This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the proceeding line items of the table. |
(6) |
Discrete tax adjustments for |
(7) |
Numbers were calculated following the same definition of Adjusted Net Income and Adjusted Net Income per share for total Company. |
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES Dollars in millions (Unaudited) |
|||||||||||||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||||||||||
|
|
|
EMEA &
|
|
Total |
|
|
|
EMEA &
|
|
Total |
||||||||||||
|
(Dollars in millions)(1) |
||||||||||||||||||||||
Net income from continuing operations (GAAP) |
|
|
|
|
$ |
59.6 |
|
|
|
|
|
|
$ |
223.4 |
|
||||||||
Income tax expense |
|
|
|
|
|
17.9 |
|
|
|
|
|
|
|
95.7 |
|
||||||||
Interest expense and other, net |
|
|
|
|
|
26.2 |
|
|
|
|
|
|
|
85.1 |
|
||||||||
Operating income (GAAP) |
$ |
50.1 |
|
|
$ |
53.6 |
|
|
$ |
103.7 |
|
|
$ |
182.5 |
|
|
$ |
221.7 |
|
|
$ |
404.2 |
|
Adjusted to add: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restructuring and other related charges(2) |
|
1.1 |
|
|
|
5.3 |
|
|
|
6.4 |
|
|
|
6.5 |
|
|
|
17.6 |
|
|
|
24.1 |
|
Acquisition - amortization and other related charges (3) |
|
5.0 |
|
|
|
4.0 |
|
|
|
9.0 |
|
|
|
20.9 |
|
|
|
15.9 |
|
|
|
36.9 |
|
Depreciation and other amortization |
|
3.7 |
|
|
|
5.7 |
|
|
|
9.4 |
|
|
|
14.8 |
|
|
|
21.2 |
|
|
|
36.0 |
|
Adjusted EBITDA (non-GAAP) |
$ |
59.8 |
|
|
$ |
68.6 |
|
|
$ |
128.5 |
|
|
$ |
224.7 |
|
|
$ |
276.4 |
|
|
$ |
501.1 |
|
Adjusted EBITDA attributable to |
|
— |
|
|
|
2.7 |
|
|
|
2.7 |
|
|
|
— |
|
|
|
18.4 |
|
|
|
18.4 |
|
Core adjusted EBITDA (non-GAAP) |
$ |
59.8 |
|
|
$ |
65.9 |
|
|
$ |
125.8 |
|
|
$ |
224.7 |
|
|
$ |
258.0 |
|
|
$ |
482.7 |
|
Adjusted EBITDA margin (non-GAAP) |
|
19.5 |
% |
|
|
18.0 |
% |
|
|
18.6 |
% |
|
|
18.5 |
% |
|
|
17.7 |
% |
|
|
18.1 |
% |
Core adjusted EBITDA margin (non-GAAP)(5) |
|
19.5 |
% |
|
|
19.3 |
% |
|
|
19.4 |
% |
|
|
18.5 |
% |
|
|
18.4 |
% |
|
|
18.4 |
% |
(1) |
Numbers may not sum due to rounding. |
(2) |
Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, and other costs in connection with the closure and optimization of facilities and product lines. |
(3) |
Includes transaction expenses, amortization of intangibles, fair value charges on acquired inventories and integration expenses. |
(4) |
Numbers calculated following the same definition as Adjusted EBITDA for total Company. |
(5) |
Net sales were |
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES Dollars in millions (Unaudited) |
|||||||||||||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||||||||||
|
|
|
EMEA &
|
|
Total |
|
|
|
EMEA &
|
|
Total |
||||||||||||
|
(Dollars in millions)(1) |
||||||||||||||||||||||
Net income from continuing operations (GAAP) |
|
|
|
|
$ |
60.4 |
|
|
|
|
|
|
$ |
231.1 |
|
||||||||
Income tax expense |
|
|
|
|
|
5.5 |
|
|
|
|
|
|
|
69.2 |
|
||||||||
Interest expense (income) and other, net |
|
|
|
|
|
18.4 |
|
|
|
|
|
|
|
38.0 |
|
||||||||
Pension settlement gain |
|
|
|
|
|
(5.8 |
) |
|
|
|
|
|
|
(9.1 |
) |
||||||||
Operating income (GAAP) |
$ |
33.7 |
|
|
$ |
44.9 |
|
|
$ |
78.6 |
|
|
$ |
136.2 |
|
|
$ |
192.8 |
|
|
$ |
329.1 |
|
Adjusted to add (deduct): |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restructuring and other related charges(2) |
|
2.3 |
|
|
|
4.1 |
|
|
|
6.5 |
|
|
|
11.4 |
|
|
|
11.7 |
|
|
|
23.1 |
|
Separation costs(3)(4) |
|
2.8 |
|
|
|
3.8 |
|
|
|
6.6 |
|
|
|
7.5 |
|
|
|
8.1 |
|
|
|
15.5 |
|
Acquisition-amortization and other related charges(5) |
|
7.8 |
|
|
|
3.9 |
|
|
|
11.7 |
|
|
|
20.1 |
|
|
|
14.1 |
|
|
|
34.2 |
|
Depreciation and other amortization |
|
3.3 |
|
|
|
5.4 |
|
|
|
8.7 |
|
|
|
13.4 |
|
|
|
21.5 |
|
|
|
34.9 |
|
Other(6) |
|
(0.3 |
) |
|
|
0.2 |
|
|
|
(0.1 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Adjusted EBITDA (non-GAAP) |
$ |
49.6 |
|
|
$ |
62.3 |
|
|
$ |
112.0 |
|
|
$ |
188.6 |
|
|
$ |
248.2 |
|
|
$ |
436.8 |
|
Adjusted EBITDA attributable to |
|
— |
|
|
|
5.0 |
|
|
|
5.0 |
|
|
|
— |
|
|
|
28.4 |
|
|
|
28.4 |
|
Core adjusted EBITDA (non-GAAP) |
$ |
49.6 |
|
|
$ |
57.3 |
|
|
$ |
107.0 |
|
|
$ |
188.6 |
|
|
$ |
219.8 |
|
|
$ |
408.4 |
|
Adjusted EBITDA margin (non-GAAP) |
|
17.5 |
% |
|
|
16.4 |
% |
|
|
16.9 |
% |
|
|
16.7 |
% |
|
|
16.9 |
% |
|
|
16.8 |
% |
Core adjusted EBITDA margin (non-GAAP)(8) |
|
17.5 |
% |
|
|
17.3 |
% |
|
|
17.4 |
% |
|
|
16.7 |
% |
|
|
16.9 |
% |
|
|
16.8 |
% |
(1) |
Numbers may not sum due to rounding. |
(2) |
Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, and other costs in connection with the closure and optimization of facilities and product lines. |
(3) |
Includes non-recurring charges and employee costs related to the planning and execution of the separation from Enovis within the Selling, general and administrative expense line within the Consolidated and Combined Statements of Operations. |
(4) |
Amounts are allocated to the segments as a percentage of revenue as the costs or gain are not discrete to either segment. |
(5) |
Includes transaction expenses, amortization of intangibles, fair value changes on acquired inventories and integration expenses. |
(6) |
Relates to the adjustment for certain items included within the Interest expense (income) and other, net line within the Consolidated and Combined Statements of Operations. |
(7) |
Numbers calculated following the same definition as Adjusted EBITDA for total Company. |
(8) |
Net sales were |
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES Change in Sales Dollars in millions (Unaudited) |
||||||||||||||||||||
|
Sales Growth(1) |
|||||||||||||||||||
|
|
|
EMEA & APAC |
|
Total |
|||||||||||||||
|
$ |
|
Change % |
|
$ |
|
Change % |
|
$ |
|
Change % |
|||||||||
For the three months ended |
$ |
283.6 |
|
|
|
|
$ |
380.6 |
|
|
|
|
$ |
664.1 |
|
|
|
|||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Existing businesses (organic sales growth)(2) |
|
25.1 |
|
|
8.8 |
% |
|
|
5.6 |
|
|
1.5 |
% |
|
|
30.7 |
|
|
4.6 |
% |
Acquisitions(3) |
|
2.2 |
|
|
0.8 |
% |
|
|
2.1 |
|
|
0.6 |
% |
|
|
4.3 |
|
|
0.6 |
% |
Foreign Currency translation(4) |
|
(3.5 |
) |
|
(1.2 |
)% |
|
|
(6.2 |
) |
|
(1.6 |
)% |
|
|
(9.7 |
) |
|
(1.5 |
)% |
Total sales growth |
|
23.8 |
|
|
8.4 |
% |
|
|
1.5 |
|
|
0.4 |
% |
|
|
25.3 |
|
|
3.8 |
% |
For the three months ended |
$ |
307.3 |
|
|
|
|
$ |
382.0 |
|
|
|
|
$ |
689.4 |
|
|
|
(1) |
Numbers may not sum due to rounding. |
(2) |
Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
(3) |
Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
(4) |
Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
|
Core Sales Growth(1)(2) |
|||||||||||||||||||
|
|
|
EMEA & APAC |
|
|
|||||||||||||||
|
$ |
|
Change % |
|
$ |
|
Change % |
|
$ |
|
Change % |
|||||||||
For the three months ended |
$ |
283.6 |
|
|
|
|
$ |
330.7 |
|
|
|
$ |
614.2 |
|
|
|||||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Existing businesses (core organic sales growth)(3) |
|
25.1 |
|
|
8.8 |
% |
|
|
0.2 |
|
|
0.1 |
% |
|
|
25.3 |
|
|
4.1 |
% |
Acquisitions(4) |
|
2.2 |
|
|
0.8 |
% |
|
|
2.1 |
|
|
0.6 |
% |
|
|
4.3 |
|
|
0.7 |
% |
Foreign Currency translation(5) |
|
(3.5 |
) |
|
(1.2 |
)% |
|
|
9.6 |
|
|
2.9 |
% |
|
|
6.1 |
|
|
1.0 |
% |
Total core sales growth(6) |
|
23.8 |
|
|
8.4 |
% |
|
|
11.9 |
|
|
3.6 |
% |
|
|
35.7 |
|
|
5.8 |
% |
For the three months ended |
$ |
307.3 |
|
|
|
|
$ |
342.6 |
|
|
|
|
$ |
649.9 |
|
|
|
(1) |
Numbers may not sum due to rounding |
(2) |
Excludes |
(3) |
Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
(4) |
Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
(5) |
Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
(6) |
Numbers calculated following the same definition as total sales growth for total Company. |
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES Change in Sales Dollars in millions (Unaudited) |
||||||||||||||||||||
|
Sales Growth |
|||||||||||||||||||
|
|
|
EMEA & APAC |
|
Total |
|||||||||||||||
|
$ |
|
Change % |
|
$ |
|
Change % |
|
$ |
|
Change % |
|||||||||
For the year ended |
$ |
1,128.3 |
|
|
|
|
$ |
1,465.2 |
|
|
|
|
$ |
2,593.5 |
|
|
|
|||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Existing businesses (organic sales growth)(1) |
|
60.5 |
|
|
5.4 |
% |
|
|
101.1 |
|
|
6.9 |
% |
|
|
161.6 |
|
|
6.2 |
% |
Acquisitions(2) |
|
43.7 |
|
|
3.9 |
% |
|
|
20.2 |
|
|
1.4 |
% |
|
|
63.9 |
|
|
2.5 |
% |
Foreign Currency translation(3) |
|
(17.5 |
) |
|
(1.5 |
)% |
|
|
(26.7 |
) |
|
(1.8 |
)% |
|
|
(44.2 |
) |
|
(1.7 |
)% |
Total sales growth |
|
86.7 |
|
|
7.7 |
% |
|
|
94.6 |
|
|
6.5 |
% |
|
|
181.3 |
|
|
7.0 |
% |
For the year ended |
$ |
1,215.0 |
|
|
|
|
$ |
1,559.8 |
|
|
|
|
$ |
2,774.8 |
|
|
|
(1) |
Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
(2) |
Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
(3) |
Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
|
Core Sales Growth(1) |
|||||||||||||||||||
|
|
|
EMEA & APAC |
|
|
|||||||||||||||
|
$ |
|
Change % |
|
$ |
|
Change % |
|
$ |
|
Change % |
|||||||||
For the year ended |
$ |
1,128.3 |
|
|
|
|
$ |
1,301.6 |
|
|
|
$ |
2,429.9 |
|
|
|
||||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Existing businesses (core organic sales growth)(2) |
|
60.5 |
|
|
5.4 |
% |
|
|
83.6 |
|
|
6.4 |
% |
|
|
144.1 |
|
|
5.9 |
% |
Acquisitions(3) |
|
43.7 |
|
|
3.9 |
% |
|
|
20.2 |
|
|
1.6 |
% |
|
|
63.9 |
|
|
2.6 |
% |
Foreign Currency translation(4) |
|
(17.5 |
) |
|
(1.5 |
)% |
|
|
0.5 |
|
|
— |
% |
|
|
(17.0 |
) |
|
(0.7 |
)% |
Total core sales growth(5) |
|
86.7 |
|
|
7.7 |
% |
|
|
104.3 |
|
|
8.0 |
% |
|
|
191.0 |
|
|
7.9 |
% |
For the year ended |
$ |
1,215.0 |
|
|
|
|
$ |
1,405.9 |
|
|
|
|
$ |
2,620.9 |
|
|
|
(1) |
Excludes |
(2) |
Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
(3) |
Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
(4) |
Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
(5) |
Numbers calculated following the same definition as total sales growth for total Company. |
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES Adjusted Free Cash Flow Dollars in millions (Unaudited) |
|||||||||||||||
|
Three Months Ended |
|
Year Ended |
||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net cash provided by operating activities (GAAP) |
$ |
122.4 |
|
|
$ |
91.4 |
|
|
$ |
330.5 |
|
|
$ |
214.4 |
|
Purchases of property, plant and equipment (GAAP) |
|
(19.3 |
) |
|
|
(18.2 |
) |
|
|
(48.2 |
) |
|
|
(40.2 |
) |
Proceeds from the sale of certain properties(1) |
|
— |
|
|
|
— |
|
|
|
2.8 |
|
|
|
2.5 |
|
Payments related to the Separation(2) |
|
— |
|
|
|
5.8 |
|
|
|
4.4 |
|
|
|
19.0 |
|
Payments related to discontinued operations |
|
2.8 |
|
|
|
3.8 |
|
|
|
15.0 |
|
|
|
23.1 |
|
Adjusted free cash flow (non-GAAP) |
$ |
105.9 |
|
|
$ |
82.8 |
|
|
$ |
304.5 |
|
|
$ |
218.8 |
|
(1) |
Includes proceeds from the sale of certain properties related to restructuring efforts for which previous cash outlays were included in Net cash used in investing activities. |
(2) |
Separation payments relate to one-time non-recurring professional fees and employee costs incurred in the planning and execution of the Separation from Enovis. |
2024 Outlook Dollars in millions (Unaudited) |
|||
|
|||
|
|
|
|
2023 Core net sales |
|
$ |
2,620.9 |
Organic growth |
|
2.5%-4.5% |
|
Currency |
|
|
(1.0%) |
2024 Core net sales growth range |
|
1.5%-3.5% |
|
|
|
|
|
2023 Core adjusted EBITDA |
|
$ |
482.7 |
2024 Core adjusted EBITDA range |
|
|
CONSOLIDATED BALANCE SHEETS Dollars in thousands (Unaudited) |
|||||||
|
|
|
|
||||
ASSETS |
|
|
|
||||
CURRENT ASSETS: |
|
|
|
||||
Cash and cash equivalents |
$ |
102,003 |
|
|
$ |
72,024 |
|
Trade receivables, less allowance for credit losses of |
|
385,198 |
|
|
|
374,329 |
|
Inventories, net |
|
392,858 |
|
|
|
416,829 |
|
Prepaid expenses |
|
61,771 |
|
|
|
56,637 |
|
Other current assets |
|
55,890 |
|
|
|
68,851 |
|
Total current assets |
|
997,720 |
|
|
|
988,670 |
|
Property, plant and equipment, net |
|
294,305 |
|
|
|
284,226 |
|
|
|
1,588,331 |
|
|
|
1,529,767 |
|
Intangible assets, net |
|
499,535 |
|
|
|
517,167 |
|
Lease assets - right of use |
|
95,607 |
|
|
|
92,033 |
|
Other assets |
|
353,131 |
|
|
|
342,152 |
|
Total assets |
$ |
3,828,629 |
|
|
$ |
3,754,015 |
|
|
|
|
|
||||
LIABILITIES AND EQUITY |
|
|
|
||||
CURRENT LIABILITIES: |
|
|
|
||||
Accounts payable |
$ |
306,593 |
|
|
$ |
316,265 |
|
Accrued liabilities |
|
313,489 |
|
|
|
285,310 |
|
Total current liabilities |
|
620,082 |
|
|
|
601,575 |
|
Long-term debt |
|
1,018,057 |
|
|
|
1,218,643 |
|
Other liabilities |
|
542,833 |
|
|
|
545,339 |
|
Total liabilities |
|
2,180,972 |
|
|
|
2,365,557 |
|
Equity: |
|
|
|
||||
Common stock - |
|
60 |
|
|
|
60 |
|
Additional paid-in capital |
|
1,881,054 |
|
|
|
1,865,904 |
|
Retained earnings |
|
350,557 |
|
|
|
159,231 |
|
Accumulated other comprehensive loss |
|
(624,272 |
) |
|
|
(674,988 |
) |
|
|
1,607,399 |
|
|
|
1,350,207 |
|
Noncontrolling interest |
|
40,258 |
|
|
|
38,251 |
|
Total equity |
|
1,647,657 |
|
|
|
1,388,458 |
|
Total liabilities and equity |
$ |
3,828,629 |
|
|
$ |
3,754,015 |
|
CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS Dollars in thousands (Unaudited) |
|||||||
|
Year Ended |
||||||
|
|
|
|
||||
|
|
|
|
||||
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
211,024 |
|
|
$ |
228,013 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation, amortization and other impairment charges |
|
75,034 |
|
|
|
65,978 |
|
Stock-based compensation expense |
|
16,122 |
|
|
|
12,964 |
|
Deferred income tax |
|
(25,408 |
) |
|
|
(20,199 |
) |
Non-cash interest expense |
|
1,195 |
|
|
|
1,972 |
|
Pension settlement gain |
|
— |
|
|
|
(9,136 |
) |
Changes in operating assets and liabilities: |
|
|
|
||||
Trade receivables, net |
|
(6,006 |
) |
|
|
(8,142 |
) |
Inventories, net |
|
17,958 |
|
|
|
(10,066 |
) |
Accounts payable |
|
(19,819 |
) |
|
|
(28,794 |
) |
Other operating assets and liabilities |
|
60,394 |
|
|
|
(18,232 |
) |
Net cash provided by operating activities |
|
330,494 |
|
|
|
214,358 |
|
Cash flows from investing activities: |
|
|
|
||||
Purchases of property, plant and equipment |
|
(48,178 |
) |
|
|
(40,243 |
) |
Proceeds from sale of property, plant and equipment |
|
4,600 |
|
|
|
4,849 |
|
Acquisitions, net of cash received |
|
(18,665 |
) |
|
|
(149,029 |
) |
Net cash used in investing activities |
|
(62,243 |
) |
|
|
(184,423 |
) |
Cash flows from financing activities: |
|
|
|
||||
Proceeds from borrowings on term credit facility |
|
— |
|
|
|
1,000,000 |
|
Repayments of borrowings on term credit facility |
|
(12,500 |
) |
|
|
— |
|
Proceeds from borrowings on revolving credit facility and other |
|
574,150 |
|
|
|
805,881 |
|
Repayments of borrowings on revolving credit facility and other |
|
(763,173 |
) |
|
|
(585,491 |
) |
Payment of deferred financing fees and other |
|
(972 |
) |
|
|
(4,706 |
) |
Payment of deferred consideration |
|
— |
|
|
|
(1,500 |
) |
Payment of dividends |
|
(13,342 |
) |
|
|
(6,054 |
) |
Consideration to Former Parent in connection with the Separation |
|
— |
|
|
|
(1,200,000 |
) |
Distributions to noncontrolling interest holders |
|
(3,880 |
) |
|
|
(3,420 |
) |
Transfers from (to) Former Parent, net |
|
— |
|
|
|
2,847 |
|
Net cash provided by (used in) financing activities |
|
(219,717 |
) |
|
|
7,557 |
|
Effect of foreign exchange rates on Cash and cash equivalents |
|
(18,555 |
) |
|
|
(6,677 |
) |
Increase in Cash and cash equivalents |
|
29,979 |
|
|
|
30,815 |
|
Cash and cash equivalents, beginning of period |
|
72,024 |
|
|
|
41,209 |
|
Cash and cash equivalents, end of period |
$ |
102,003 |
|
|
$ |
72,024 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240229439014/en/
Investor Relations Contact:
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