Third Quarter 2024 Highlights
- Earnings per diluted share (EPS) of $1.33, up 39%, and adjusted
EPS of $1.38, up 34%.
- Sales of $597 million, up 13% driven by 6% core sales
growth.
- Core order growth up 6% and core backlog growth up 10%, driven
primarily by ongoing strength at Aerospace & Electronics.
- Declaring fourth quarter 2024 regular dividend of $0.205 per
share.
Full Year Outlook
- Raising and narrowing our full year adjusted EPS outlook to a
range of $5.05-$5.20, up from $4.95-$5.15.
Crane Company ("Crane," NYSE: CR) today announced its financial
results for the third quarter of 2024 and raised and narrowed its
adjusted full-year EPS outlook.
Max Mitchell, Crane's Chairman, President and Chief Executive
Officer, stated: "We delivered another quarter of excellent
results, with 34% adjusted EPS growth driven by 6% core sales
growth, reflecting continued strong execution by our teams
globally. Furthermore, demand trends across our strategic growth
platforms were also encouraging in the quarter, with 6%
year-over-year core order growth and 10% year-over-year core
backlog growth, giving us confidence as we close out the year and
increasingly look toward 2025. Taken together, we are raising our
2024 adjusted EPS outlook to a range of $5.05-$5.20, up from our
prior view of $4.95-$5.15.”
Mr. Mitchell concluded: “While our updated full year guidance
represents yet another record year for Crane, our outperformance is
tempered by the impact of Hurricane Helene on one of our Process
Flow Technologies facilities in Marion, North Carolina, and
accordingly, our underlying performance is even stronger. I am
incredibly proud of our team's efforts on executing on recovery
actions which we expect to be completed in the fourth quarter.”
Third Quarter 2024 Results
Third quarter 2024 GAAP EPS of $1.33 compared to $0.96 in the
third quarter of 2023. Third quarter 2024 adjusted EPS of $1.38
compared to $1.03 in the third quarter of 2023.
Third quarter sales increased 13%, with 6% core sales growth, a
6% contribution from acquisitions, and a slight contribution from
favorable foreign exchange. Operating profit of $105 million
increased 38% compared to last year, and adjusted operating profit
of $109 million increased 35% compared to last year, in both cases
primarily reflecting the impact from net price and
productivity.
Summary of Third Quarter 2024 Results
Third Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$597
$530
$
67
13
%
Core sales
32
6
%
Acquisitions
34
6
%
Foreign exchange
1
0
%
Operating profit
$105
$76
$
29
38
%
Adjusted operating profit*
$109
$81
$
28
35
%
Operating profit margin
17.6%
14.4%
320bps
Adjusted operating profit margin*
18.3%
15.2%
310bps
*Please see the attached Non-GAAP
Financial Measures tables
Cash Flow, Financing Activities and Other Financial
Metrics
During the third quarter of 2024, cash provided by operating
activities was $82 million, capital expenditures were $9 million,
and free cash flow (cash provided by operating activities less
capital spending) was $73 million. Adjusted free cash flow (free
cash flow excluding transaction related cash outflows) was $75
million. (Please see the attached non-GAAP Financial Measures
tables.)
As of September 30, 2024, the Company's cash balance was $258
million with total debt of $332 million.
Rich Maue, Crane's Executive Vice President and Chief Financial
Officer, added: "For the full year, we now expect free cash flow to
fall at the lower end of our estimated $255-$275 million range,
primarily due to working capital headwinds commercial aerospace
suppliers are facing, now coupled with the timing of
hurricane-related insurance recoveries.
However, these items are transitory, and our strong balance
sheet gives us the flexibility to continue investing strategically,
while providing the opportunity for further capital deployment. As
always, we will deploy our capital with the same strict financial
and strategic discipline that we have always employed. We see
numerous opportunities for value-creating acquisitions to further
accelerate our growth, and with the ability to generate enhanced
returns given our lengthy track record of successful acquisition
integration and synergy generation."
Third Quarter 2024 Segment Results
All comparisons detailed in this section refer to operating
results for the third quarter 2024 versus the third quarter
2023.
Aerospace & Electronics
Third Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$
239
$
207
$
32
15
%
Core sales
21
10
%
Acquisitions
11
5
%
Operating profit
$
55
$
40
$
15
37
%
Adjusted operating profit*
$
56
$
40
$
16
40
%
Operating profit margin
23.0
%
19.4
%
360bps
Adjusted operating profit margin*
23.5
%
19.4
%
410bps
*Please see the attached Non-GAAP
Financial Measures tables
Sales of $239 million increased 15% compared to the prior year,
driven by 10% core sales growth and a 5% benefit from the
previously announced Vian acquisition. Operating profit margin of
23.0% increased 360 basis points from last year, primarily
reflecting the impact of higher price net of inflation,
productivity, and higher volumes partially offset by unfavorable
mix. Adjusted operating profit margin of 23.5% increased 410 basis
points from last year. Aerospace & Electronics' order backlog
was $833 million as of September 30, 2024 compared to $701 million
as of December 31, 2023, and $678 million as of September 30,
2023.
Process Flow Technologies
Third Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$
309
$
267
$
42
16
%
Core sales
18
7
%
Foreign exchange
1
0
%
Acquisitions
23
9
%
Operating profit
$
66
$
51
$
14
28
%
Adjusted operating profit*
$
67
$
51
$
16
31
%
Operating profit margin
21.2
%
19.2
%
200bps
Adjusted operating profit margin*
21.8
%
19.2
%
260bps
*Please see the attached Non-GAAP
Financial Measures tables
Sales of $309 million increased 16% compared to the prior year,
driven by 7% core sales growth and a 9% benefit from the previously
announced Baum and CryoWorks acquisitions. Operating profit margin
expanded 200 basis points to 21.2% primarily due to favorable net
price, productivity, and higher volumes, partially offset by
unfavorable mix. Adjusted operating profit margin expanded 260
basis points to 21.8% from last year. Process Flow Technologies
order backlog was $392 million as of September 30, 2024 compared to
$379 million as of December 31, 2023, and $353 million as of
September 30, 2023.
Engineered Materials
Third Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$
49
$
56
$
(7
)
(13
%)
Operating profit
$
6
$
8
$
(2
)
(20
%)
Adjusted operating profit*
$
6
$
8
$
(1
)
(18
%)
Operating profit margin
12.7
%
13.7
%
(100bps)
Adjusted operating profit margin*
12.9
%
13.7
%
(80bps)
*Please see the attached Non-GAAP
Financial Measures tables
Sales of $49 million decreased 13% compared to the prior year.
Operating profit margin declined 100 basis points to 12.7%, and
adjusted operating profit margin declined 80 basis points to 12.9%,
primarily driven by lower volumes.
Updating 2024 Guidance
We are raising and narrowing our full-year adjusted EPS outlook
to a range of $5.05 to $5.20, up from our prior view of $4.95 to
$5.15.
Key assumptions for our revised guidance include:
- Total sales growth of approximately 11% (unchanged), driven by
core sales growth of approximately 5% to 7% (unchanged, but now
expected to be at the higher end of the range) and an acquisition
benefit of approximately 5% (unchanged).
- Adjusted segment operating margin of ~20.8% (up from
20.7%).
- Corporate cost of $80 million (unchanged).
- Net non-operating expense of $20 million (unchanged).
- Adjusted tax rate of 22.5% (prior 23.0%).
- Diluted shares of ~58 million (unchanged).
- Includes the negative impact from the production downtime
resulting from Hurricane Helene.
Additional details of our outlook and guidance are included in
the presentation that accompanies this earnings release available
on our website at www.craneco.com in the "investors" section.
Declaring Fourth Quarter Dividend
Crane announced its regular quarterly dividend of $0.205 per
share for the fourth quarter of 2024. The dividend is payable on
December 11, 2024 to shareholders of record as of November 29,
2024.
Additional Information
References to changes in “core sales” or "core growth" in this
report include the change in sales excluding the impact of foreign
currency translation and acquisitions and divestitures from closing
up to the first anniversary of such acquisitions or
divestitures.
Crane operated as part of Crane Holdings, Co. for the entire
first quarter of 2023 prior to completion of the separation
transaction on April 3, 2023. First quarter 2023 results, as
initially reported in May 2023, were derived from Crane Holdings,
Co.'s accounting records and were presented on a carve-out basis.
All of Crane's subsequent financial disclosures for pre-separation
periods show the financial results of Crane Holdings, Co. (now
renamed Crane NXT, Co.) with the Payment & Merchandising
Technologies segment presented as discontinued operations.
As a result of the change in accounting presentation required by
GAAP, first quarter 2023 GAAP EPS was reported as $1.08 when
initially reported on a carve-out basis, and in subsequent reports,
reported as $0.98 with the Payment & Merchandising Technologies
segment presented as discontinued operations. First quarter 2023
Adjusted EPS on a carve-out basis was reported as $1.25, and $1.26
with the Payment & Merchandising Technologies segment presented
as discontinued operations. Segment operating profit was the same
under both accounting methodologies.
Conference Call
Crane has scheduled a conference call to discuss the third
quarter financial results on Tuesday, October 29, 2024 at 10:00
A.M. (Eastern). All interested parties may listen to a live webcast
of the call at www.craneco.com. An archived webcast will also be
available to replay this conference call directly from the
Company’s website under Investors, Events & Presentations.
Slides that accompany the conference call will be available on the
Company’s website.
About Crane Company
Crane Company has delivered innovation and technology-led
solutions for customers since its founding in 1855. Today, Crane is
a leading manufacturer of highly engineered components for
challenging, mission-critical applications focused on the
aerospace, defense, space and process industry end markets. The
Company has two strategic growth platforms: Aerospace &
Electronics and Process Flow Technologies. Crane has approximately
7,500 employees in the Americas, Europe, the Middle East, Asia and
Australia. Crane Company is traded on the New York Stock Exchange
(NYSE: CR). For more information, visit www.craneco.com.
Forward-Looking Statements Disclaimer
This press release contains forward-looking statements within
the meaning of the federal securities laws. Forward-looking
statements include all statements that are not historical
statements of fact and those regarding our intent, belief, or
expectations, including, but not limited to: benefits and synergies
of the separation transaction; strategic and competitive advantages
of Crane; future financing plans and opportunities; and business
strategies, prospects and projected operating and financial
results. We caution investors not to place undue reliance on any
such forward-looking statements.
These statements are based on management’s current expectations
and beliefs and are subject to a number of risks and uncertainties
that could lead to actual results differing materially from those
projected, forecasted or expected. Although we believe that the
assumptions underlying the forward-looking statements are
reasonable, we can give no assurance that our expectations will be
attained.
Risks and uncertainties that could cause actual results to
differ materially from our expectations include, but are not
limited to: changes in global economic conditions (including
inflationary pressures) and geopolitical risks, including
macroeconomic fluctuations that may harm our business, results of
operation and stock price; information systems and technology
networks failures and breaches in data security, theft of
personally identifiable and other information, non-compliance with
our contractual or other legal obligations regarding such
information; our ability to source components and raw materials
from suppliers, including disruptions and delays in our supply
chain; demand for our products, which is variable and subject to
factors beyond our control; governmental regulations and failure to
comply with those regulations; fluctuations in the prices of our
components and raw materials; loss of personnel or being able to
hire and retain additional personnel needed to sustain and grow our
business as planned; risks from environmental liabilities, costs,
litigation and violations that could adversely affect our financial
condition, results of operations, cash flows and reputation; risks
associated with conducting a substantial portion of our business
outside the U.S.; being unable to identify or complete
acquisitions, or to successfully integrate the businesses we
acquire, or complete dispositions; adverse impacts from intangible
asset impairment charges; potential product liability or warranty
claims; being unable to successfully develop and introduce new
products, which would limit our ability to grow and maintain our
competitive position and adversely affect our financial condition,
results of operations and cash flow; significant competition in our
markets; additional tax expenses or exposures that could affect our
financial condition, results of operations and cash flows;
inadequate or ineffective internal controls; specific risks
relating to our reportable segments, including Aerospace &
Electronics, Process Flow Technologies and Engineered Materials;
the ability and willingness of Crane Company and Crane NXT, Co. to
meet and/or perform their obligations under any contractual
arrangements that are entered into among the parties in connection
with the separation transaction and any of their obligations to
indemnify, defend and hold the other party harmless from and
against various claims, litigation and liabilities; and the ability
to achieve some or all the benefits that we expect to achieve from
the separation transaction.
Readers should carefully review Crane’s financial statements and
the notes thereto, as well as the section entitled “Risk Factors”
in Item 1A of Crane’s Annual Report on Form 10-K for the year ended
December 31, 2023 and the other documents Crane files from time to
time with the SEC. These filings identify and address other
important risks and uncertainties that could cause actual events
and results to differ materially from those contained in the
forward-looking statements. Crane assumes no (and disclaims any)
obligation to revise or update any forward-looking statements.
We make no representations or warranties as to the accuracy of
any projections, statements or information contained in this press
release. It is understood and agreed that any such projections,
targets, statements and information are not to be viewed as facts
and are subject to significant business, financial, economic,
operating, competitive and other risks, uncertainties and
contingencies many of which are beyond our control, that no
assurance can be given that any particular financial projections
ranges, or targets will be realized, that actual results may differ
from projected results and that such differences may be material.
While all financial projections, estimates and targets are
necessarily speculative, we believe that the preparation of
prospective financial information involves increasingly higher
levels of uncertainty the further out the projection, estimate or
target extends from the date of preparation. The assumptions and
estimates underlying the projected, expected or target results are
inherently uncertain and are subject to a wide variety of
significant business, economic and competitive risks and
uncertainties that could cause actual results to differ materially
from those contained in the financial projections, estimates and
targets. The inclusion of financial projections, estimates and
targets in this press release should not be regarded as an
indication that we or our representatives, considered or consider
the financial projections, estimates and targets to be a reliable
prediction of future events.
(Financial Tables Follow)
Source: Crane Company
CRANE COMPANY
Condensed Statements of
Operations Data
(unaudited, in millions, except
per share data)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Net sales:
Aerospace & Electronics
$
239.1
$
207.2
$
695.9
$
576.5
Process Flow Technologies
309.2
266.7
891.2
801.3
Engineered Materials
48.9
56.2
156.6
175.7
Total net sales
$
597.2
$
530.1
$
1,743.7
$
1,553.5
Operating profit:
Aerospace & Electronics
$
54.9
$
40.2
$
155.9
$
116.1
Process Flow Technologies
65.5
51.2
181.9
165.1
Engineered Materials
6.2
7.7
21.6
28.9
Corporate
(21.4
)
(22.8
)
(68.2
)
(93.2
)
Total operating profit
$
105.2
$
76.3
$
291.2
$
216.9
Interest income
$
1.5
$
1.5
$
4.0
$
3.2
Interest expense
(7.3
)
(4.8
)
(21.9
)
(16.7
)
Miscellaneous income (expense), net
0.7
1.3
0.5
(0.5
)
Income from continuing operations before
income taxes
100.1
74.3
273.8
202.9
Provision for income taxes
22.8
19.1
60.1
48.5
Net income from continuing operations
attributable to common shareholders
77.3
55.2
213.7
154.4
Income from discontinued operations, net
of tax
—
—
—
52.1
Net income attributable to common
shareholders
$
77.3
$
55.2
$
213.7
$
206.5
Earnings per diluted share from continuing
operations
$
1.33
$
0.96
$
3.67
$
2.69
Earnings per diluted share from
discontinued operations
—
—
—
0.91
Earnings per diluted share
$
1.33
$
0.96
$
3.67
$
3.60
Average diluted shares outstanding
58.3
57.5
58.2
57.4
Average basic shares outstanding
57.2
56.8
57.1
56.7
Supplemental data:
Cost of sales
$
359.2
$
326.9
$
1,061.3
$
942.3
Selling, general & administrative
132.8
126.9
391.2
394.3
Transaction related expenses (a)
3.6
4.3
16.3
36.5
Repositioning related charges, net (a)
0.3
0.1
0.8
2.1
Depreciation and amortization (a)
13.9
9.3
40.6
28.3
Stock-based compensation expense (a)
5.2
7.9
18.7
21.9
(a) Amounts included within Cost of sales
and/or Selling, general & administrative costs.
CRANE COMPANY
Condensed Balance
Sheets
(unaudited, in millions)
September 30,
2024
December 31,
2023
Assets
Current assets
Cash and cash equivalents
$
258.2
$
329.6
Accounts receivable, net
396.1
306.4
Inventories, net
398.1
353.1
Other current assets
192.4
101.7
Total current assets
1,244.8
1,090.8
Property, plant and equipment, net
277.0
270.5
Other assets
302.3
224.6
Goodwill
827.8
747.7
Total assets
$
2,651.9
$
2,333.6
Liabilities and Equity
Current liabilities
Short-term borrowings
$
85.0
$
—
Accounts payable
169.6
179.1
Accrued liabilities
313.4
273.7
Income taxes
4.1
14.3
Total current liabilities
572.1
467.1
Long-term debt
246.9
248.5
Long-term deferred tax liability
51.8
37.1
Other liabilities
204.2
220.6
Total liabilities
1,075.0
973.3
Total equity
1,576.9
1,360.3
Total liabilities and equity
$
2,651.9
$
2,333.6
CRANE COMPANY
Condensed Statements of Cash
Flows
(unaudited, in millions)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Operating activities:
Net income attributable to common
shareholders
$
77.3
$
55.2
$
213.7
$
206.5
Less: Income from discontinued operations,
net of tax
—
—
—
52.1
Net income from continuing operations
attributable to common shareholders
77.3
55.2
213.7
154.4
Depreciation and amortization
13.9
9.3
40.6
28.3
Stock-based compensation expense
5.2
7.9
18.7
21.9
Defined benefit plans and postretirement
cost
0.9
2.2
2.8
7.0
Deferred income taxes
—
6.2
—
2.5
Cash (used for) provided by operating
working capital
(5.1
)
17.9
(191.5
)
(165.4
)
Defined benefit plans and postretirement
contributions
(10.6
)
(10.4
)
(16.6
)
(16.1
)
Environmental payments, net of
reimbursements
(0.7
)
(1.1
)
(3.5
)
(3.0
)
Other
0.8
(0.3
)
(0.4
)
4.3
Total provided by operating activities
from continuing operations
81.7
86.9
63.8
33.9
Investing activities:
Payment for acquisitions - net of cash
acquired and working capital adjustments
4.6
—
(161.7
)
—
Capital expenditures
(9.0
)
(9.2
)
(25.5
)
(29.7
)
Other investing activities
(0.1
)
0.9
5.6
0.6
Total used for investing activities from
continuing operations
(4.5
)
(8.3
)
(181.6
)
(29.1
)
Financing activities:
Dividends paid
(11.7
)
(10.2
)
(35.1
)
(47.0
)
Net proceeds (payments) related to
employee stock plans
1.6
2.0
(3.5
)
15.7
Debt issuance costs
—
—
—
(7.5
)
Proceeds from long-term debt
—
—
190.0
300.0
Proceeds from term facility of
discontinued operations
—
—
—
350.0
Repayments of long-term debt
(45.0
)
(11.9
)
(106.9
)
(448.8
)
Distribution of Crane NXT, Co.
—
—
—
(578.1
)
Total (used for) provided by financing
activities from continuing and discontinued operations
(55.1
)
(20.1
)
44.5
(415.7
)
Discontinued operations:
Total provided by operating activities
—
—
—
34.6
Total used for investing activities
—
—
—
(4.1
)
Increase in cash and cash equivalents from
discontinued operations
—
—
—
30.5
Effect of exchange rate on cash and cash
equivalents
6.8
(3.6
)
1.9
(3.4
)
Increase (decrease) in cash and cash
equivalents
28.9
54.9
(71.4
)
(383.8
)
Cash and cash equivalents at beginning of
period (a)
229.3
218.9
329.6
657.6
Cash and cash equivalents at end of
period
$
258.2
$
273.8
$
258.2
$
273.8
(a) 2023 Includes cash and cash
equivalents of discontinued operations.
CRANE COMPANY
Order Backlog
(unaudited, in millions)
September 30,
June 30,
March 31,
December 31,
September 30,
2024
2024
2024
2023
2023
Aerospace & Electronics (a)
$
833.3
$
814.9
$
791.8
$
700.9
$
677.9
Process Flow Technologies(b) (c)
392.0
399.9
393.3
379.0
352.9
Engineered Materials
12.3
11.0
12.8
11.3
14.6
Total backlog
$
1,237.6
$
1,225.8
$
1,197.9
$
1,091.2
$
1,045.4
(a) Includes $59.1 million, $62.3 million
and $53.5 million of backlog as of September 30, 2024, June 30,
2024 and March 31, 2024, respectively, pertaining to the Vian
acquisition.
(b) Includes $12.8 million, $11.6 million
of backlog as of September 30,2024 and June 30, 2024, respectively,
pertaining to the CryoWorks acquisition.
(c) Includes $6.4 million, $6.4 million,
$8.3 million and $11.5 million of backlog as of September 30, 2024,
June 30, 2024, March 31, 2024 and December 31, 2023, respectively,
pertaining to the Baum acquisition.
CRANE COMPANY
Non-GAAP Financial
Measures
(unaudited, in millions, except
per share data)
Three Months Ended September
30,
2024
2023
% Change
$
Per Share
$
Per Share
(on $)
Net sales (GAAP)
$
597.2
$
530.1
12.7
%
Adjusted Operating Profit and Adjusted
Operating Profit Margin
Operating profit (GAAP)
$
105.2
$
76.3
37.9
%
Operating profit margin (GAAP)
17.6
%
14.4
%
Special items impacting operating
profit:
Transaction related expenses(a)(b)
3.6
4.3
Repositioning related charges, net
0.3
0.1
Adjusted operating profit (Non-GAAP)
$
109.1
$
80.7
35.2
%
Adjusted operating profit margin
(Non-GAAP)
18.3
%
15.2
%
Adjusted Net Income and Adjusted Net
Income per Share
Net income from continuing operations
attributable to common shareholders (GAAP)
$
77.3
$
1.33
$
55.2
$
0.96
40.0
%
Transaction related expenses(a)(b)
3.7
0.06
4.3
0.08
Repositioning related charges, net
0.3
0.01
0.1
—
Impact of pension non-service costs
0.1
—
(0.1
)
—
Tax effect of the Non-GAAP adjustments
(1.1
)
(0.02
)
(0.5
)
(0.01
)
Adjusted net income (Non-GAAP)
$
80.3
$
1.38
$
59.0
$
1.03
36.1
%
Adjusted EBITDA and Adjusted EBITDA
Margin
Net income (GAAP)
$
77.3
$
55.2
40.0
%
Net income margin (GAAP)
12.9
%
10.4
%
Adjustments to net income:
Interest expense, net
5.8
3.3
Income tax expense
22.8
19.1
Depreciation
9.2
8.1
Amortization
4.7
1.2
Miscellaneous income, net
(0.7
)
(1.3
)
Repositioning related charges, net
0.3
0.1
Transaction related expenses(a)(b)
1.7
4.3
Adjusted EBITDA (Non-GAAP)
$
121.1
$
90.0
34.6
%
Adjusted EBITDA Margin (Non-GAAP)
20.3
%
17.0
%
(a) 2024 transaction-related expenses
primarily associated with the Vian and CryoWorks acquisitions.
(b) 2023 transaction-related expenses
primarily associated with the separation and the Baum
acquisition.
Totals may not sum due to rounding
CRANE COMPANY
Non-GAAP Financial
Measures
(in millions, except per share
data)
Nine Months Ended September
30,
2024
2023
% Change
$
Per Share
$
Per Share
(on $)
Net sales (GAAP)
$
1,743.7
$
1,553.5
12.2
%
Adjusted Operating Profit and Adjusted
Operating Profit Margin
Operating profit (GAAP)
$
291.2
$
216.9
34.3
%
Operating profit margin (GAAP)
16.7
%
14.0
%
Special items impacting operating
profit:
Transaction related expenses(a)(b)
16.3
36.5
Repositioning related charges, net
0.8
2.1
Adjusted operating profit (Non-GAAP)
$
308.3
$
255.5
20.7
%
Adjusted operating profit margin
(Non-GAAP)
17.7
%
16.4
%
Adjusted Net Income and Adjusted Net
Income per Share
Net income from continuing operations
attributable to common shareholders (GAAP)
$
213.7
$
3.67
$
154.4
$
2.69
38.4
%
Transaction related expenses(a)(b)
15.8
0.27
36.5
0.63
Repositioning related charges, net
0.8
0.01
2.1
0.04
Impact of pension non-service costs
0.4
0.01
2.8
0.05
Interest expense
—
—
5.9
0.10
Tax effect of the Non-GAAP adjustments
(3.8
)
(0.06
)
(7.1
)
(0.12
)
Adjusted net income (Non-GAAP)
$
226.9
$
3.90
$
194.6
$
3.39
16.6
%
Adjusted EBITDA and Adjusted EBITDA
Margin
Net income (GAAP)
$
213.7
$
154.4
38.4
%
Net income margin (GAAP)
12.3
%
9.9
%
Adjustments to net income:
Interest expense, net
17.9
13.5
Income tax expense
60.1
48.5
Depreciation
27.7
24.1
Amortization
12.9
4.2
Miscellaneous (income) expense, net
(0.5
)
0.5
Repositioning related charges, net
0.8
2.1
Transaction related expenses(a)(b)
11.0
36.5
Adjusted EBITDA (Non-GAAP)
$
343.6
$
283.8
21.1
%
Adjusted EBITDA Margin (Non-GAAP)
19.7
%
18.3
%
(a) 2024 transaction-related expenses are
primarily associated with the Vian and CryoWorks acquisitions.
(b) 2023 transaction-related expenses are
primarily associated with the separation and the Baum
acquisition.
Totals may not sum due to rounding
CRANE COMPANY
Non-GAAP Financial Measures by
Segment
(unaudited, in millions)
Three Months Ended September 30,
2024
Aerospace &
Electronics
Process Flow
Technologies
Engineered Materials
Corporate
Total Company
Net sales
$
239.1
$
309.2
$
48.9
$
—
$
597.2
Operating profit (GAAP)
$
54.9
$
65.5
$
6.2
$
(21.4
)
$
105.2
Operating profit margin (GAAP)
23.0
%
21.2
%
12.7
%
17.6
%
Special items impacting operating
profit:
Transaction related expenses(a)
1.4
1.6
—
0.6
3.6
Repositioning related charges, net
—
0.2
0.1
—
0.3
Adjusted operating profit (Non-GAAP)
$
56.3
$
67.3
$
6.3
$
(20.8
)
$
109.1
Adjusted operating profit margin
(Non-GAAP)
23.5
%
21.8
%
12.9
%
18.3
%
Three Months Ended September 30,
2023
Net sales
$
207.2
$
266.7
$
56.2
$
—
$
530.1
Operating profit (GAAP)
$
40.2
$
51.2
$
7.7
$
(22.8
)
$
76.3
Operating profit margin (GAAP)
19.4
%
19.2
%
13.7
%
14.4
%
Special items impacting operating
profit:
Transaction related expenses(b)
—
—
—
4.3
4.3
Repositioning related charges, net
—
0.1
—
—
0.1
Adjusted operating profit (Non-GAAP)
$
40.2
$
51.3
$
7.7
$
(18.5
)
$
80.7
Adjusted operating profit margin
(Non-GAAP)
19.4
%
19.2
%
13.7
%
15.2
%
(a) 2024 transaction-related expenses are
primarily associated with the Vian and CryoWorks acquisitions.
(b) 2023 transaction-related expenses are
primarily associated with the separation and the Baum
acquisition.
Totals may not sum due to rounding
CRANE COMPANY
Non-GAAP Financial Measures by
Segment
(in millions)
Nine Months Ended September 30,
2024
Aerospace &
Electronics
Process Flow
Technologies
Engineered Materials
Corporate
Total Company
Net sales
$
695.9
$
891.2
$
156.6
$
—
$
1,743.7
Operating profit (GAAP)
$
155.9
$
181.9
$
21.6
$
(68.2
)
$
291.2
Operating profit margin (GAAP)
22.4
%
20.4
%
13.8
%
16.7
%
Special items impacting operating
profit:
Transaction related expenses(a)
6.0
4.8
—
5.5
16.3
Repositioning related charges , net
—
0.7
0.1
—
0.8
Adjusted operating profit (Non-GAAP)
$
161.9
$
187.4
$
21.7
$
(62.7
)
$
308.3
Adjusted operating profit margin
(Non-GAAP)
23.3
%
21.0
%
13.9
%
17.7
%
Nine Months Ended September 30,
2023
Net sales
$
576.5
$
801.3
$
175.7
$
—
$
1,553.5
Operating profit (GAAP)
$
116.1
$
165.1
$
28.9
$
(93.2
)
$
216.9
Operating profit margin (GAAP)
20.1
%
20.6
%
16.4
%
14.0
%
Special items impacting operating
profit:
Transaction related expenses(b)
—
—
—
36.5
36.5
Repositioning related charges, net
—
2.4
(0.3
)
—
2.1
Adjusted operating profit (Non-GAAP)
$
116.1
$
167.5
$
28.6
$
(56.7
)
$
255.5
Adjusted operating profit margin
(Non-GAAP)
20.1
%
20.9
%
16.3
%
16.4
%
(a) 2024 transaction-related expenses are
primarily associated with the Vian and CryoWorks acquisitions.
(b) 2023 transaction-related expenses are
primarily associated with the separation and the Baum
acquisition.
Totals may not sum due to rounding
CRANE COMPANY
Adjusted Free Cash
Flow
(unaudited, in millions, except
per share data)
Three Months Ended
September 30,
Nine Months Ended
September 30,
Cash Flow Items
2024
2023
2024
2023
Cash provided by operating activities from
continuing operations
$
81.7
$
86.9
$
63.8
$
33.9
Less: Capital expenditures
(9.0
)
(9.2
)
(25.5
)
(29.7
)
Free cash flow
$
72.7
$
77.7
$
38.3
$
4.2
Adjustments:
Transaction-related expenses
$
2.4
$
4.3
$
7.5
$
36.5
Adjusted free cash flow
$
75.1
$
82.0
$
45.8
$
40.7
Crane Company reports its financial results in accordance with
U.S. generally accepted accounting principles (“GAAP”). This press
release includes certain non-GAAP financial measures, including
adjusted operating profit, adjusted operating profit margin,
adjusted net income, adjusted EPS, adjusted EBITDA, Free Cash Flow
and Adjusted Free Cash Flow, that are not prepared in accordance
with GAAP. These non-GAAP measures are an addition, and not a
substitute for or superior to, measures of financial performance
prepared in accordance with GAAP and should not be considered as an
alternative to operating income, net income or any other
performance measures derived in accordance with GAAP. We believe
that these non-GAAP measures of financial results (including on a
forward-looking or projected basis) provide useful supplemental
information to investors about Crane Company. Our management uses
certain forward looking non-GAAP measures to evaluate projected
financial and operating results. However, there are a number of
limitations related to the use of these non-GAAP measures and their
nearest GAAP equivalents. For example, other companies may
calculate non-GAAP measures differently or may use other measures
to calculate their financial performance, and therefore our
non-GAAP measures may not be directly comparable to similarly
titled measures of other companies.
Reconciliations of certain forward-looking and projected
non-GAAP measures for Crane Company, including Adjusted EPS, and
Adjusted segment margin to the closest corresponding GAAP measure
are not available without unreasonable efforts due to the high
variability, complexity and low visibility with respect to the
charges excluded from these non-GAAP measures, which could have a
potentially significant impact on our future GAAP results. For
Crane Company, these forward looking and projected non-GAAP
measures are calculated as follows:
- "Adjusted operating margin" is calculated as adjusted operating
profit divided by sales. Adjusted operating profit is calculated as
operating profit before Special Items which include transaction
related expenses such as professional fees, and incremental costs
related to the separation; and repositioning related charges. We
believe that non-GAAP financial measures that exclude these items
provide investors with an alternative metric that can assist in
predicting future earnings and profitability that are complementary
to GAAP metrics.
- "Adjusted EPS" is calculated as adjusted net income divided by
diluted shares. Adjusted net income is calculated as net income
adjusted for Special Items which include transaction related
expenses such as professional fees, and incremental costs related
to the separation; repositioning related charges; and, the impact
of pension non-service costs. We believe that non-GAAP financial
measures adjusted for these items provide investors with an
alternative metric that can assist in predicting future earnings
and profitability that are complementary to GAAP metrics.
We believe that each of the following non-GAAP measures provides
useful information to investors regarding the Company’s financial
conditions and operations:
- "Adjusted Operating Profit" and "Adjusted Operating Margin" add
back to Operating Profit items which are outside of our core
performance, some of which may or may not be non-recurring, and
which we believe may complicate the interpretation of the Company’s
underlying earnings and operational performance. These items
include income and expense such as: transaction related expenses
and repositioning related (gains) charges. These items are not
incurred in all periods, the size of these items is difficult to
predict, and none of these items are indicative of the operations
of the underlying businesses. We believe that non-GAAP financial
measures that exclude these items provide investors with an
alternative metric that can assist in predicting future earnings
and profitability that are complementary to GAAP metrics.
- "Adjusted Net Income" and "Adjusted EPS" exclude items which
are outside of our core performance, some of which may or may not
be non-recurring, and which we believe may complicate the
presentation of the Company’s underlying earnings and operational
performance. These measures include income and expense items that
impacted Operating Profit such as: transaction related expenses and
repositioning related (gains) charges. Additionally, these non-GAAP
financial measures exclude income and expense items that impacted
Net Income and Earnings per Diluted Share such as the impact of
pension non-service costs. These items are not incurred in all
periods, the size of these items is difficult to predict, and none
of these items are indicative of the operations of the underlying
businesses. We believe that non-GAAP financial measures that
exclude these items provide investors with an alternative metric
that can assist in predicting future earnings and profitability
that are complementary to GAAP metrics.
- "Adjusted EBITDA" adds back to net income: net interest
expense, income tax expense, depreciation and amortization,
miscellaneous (income) expense, net, and Special Items including
transaction related expenses. "Adjusted EBITDA Margin" is
calculated as adjusted EBITDA divided by net sales. We believe that
adjusted EBITDA and adjusted EBITDA margin provide investors with
an alternative metric that may be a meaningful indicator of our
performance and provides useful information to investors regarding
our financial conditions and results of operations that is
complementary to GAAP metrics.
- “Free Cash Flow” and “Adjusted Free Cash Flow” provide
supplemental information to assist management and investors in
analyzing the Company’s ability to generate liquidity from its
operating activities. The measure of free cash flow does not take
into consideration certain other non-discretionary cash
requirements such as, for example, mandatory principal payments on
the Company’s long-term debt. Free Cash Flow is calculated as cash
provided by operating activities less capital spending. Adjusted
Free Cash Flow is calculated as Free Cash Flow adjusted for certain
cash items which we believe may complicate the interpretation of
the Company’s underlying free cash flow performance such as certain
transaction related cash flow items related to the separation
transaction. These items are not incurred in all periods, the size
of these items is difficult to predict, and none of these items are
indicative of the operations of the underlying businesses. We
believe that non-GAAP financial measures that exclude these items
provide investors with an alternative metric that can assist in
predicting future cash flows that are complementary to GAAP
metrics.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241028606945/en/
Jason D. Feldman Senior Vice President, Investor Relations,
Treasury & Tax Allison Poliniak-Cusic Vice President, Investor
Relations IR@craneco.com www.craneco.com
Crane (NYSE:CR)
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