Second Quarter 2024 Highlights
- Earnings per diluted share (EPS) of $1.23, up 64% and adjusted
EPS of $1.30, up 18%.
- Sales of $581 million, up 14% driven by 9% core sales
growth.
Full Year Outlook
- Raising the midpoint of our full-year adjusted EPS guidance by
$0.15 and narrowing the full year adjusted EPS outlook to a range
of $4.95-$5.15, from prior range of $4.75-$5.05.
Crane Company ("Crane," NYSE: CR) today announced its financial
results for the second quarter of 2024 and updated its full-year
outlook.
Max Mitchell, Crane's Chairman, President and Chief Executive
Officer, stated: “Our Crane team delivered 18% adjusted EPS growth
in the quarter, driven by 9% core sales growth and solid core
operating leverage of 40%. Our results in the quarter reflect
benefits from our strategic investments in growth and commercial
excellence, which continue to add value for our customers and drive
above market core sales growth across both Aerospace &
Electronics and Process Flow Technologies."
Mr. Mitchell concluded: “With a strong first half of 2024 behind
us, we have incredible momentum across our key verticals. Our
balance sheet provides significant optionality to invest in both
organic opportunities and strategic acquisitions to further amplify
growth. Coupled with the solid order growth and strong backlog, we
are raising the midpoint of our full-year adjusted EPS guidance by
$0.15 and narrowing our adjusted EPS guidance range to $4.95 to
$5.15, from $4.75 to $5.05."
Second Quarter 2024 Results
Second quarter 2024 GAAP EPS of $1.23 compared to $0.75 in the
second quarter of 2023. Second quarter 2024 adjusted EPS of $1.30
compared to $1.10 in the second quarter of 2023.
Second quarter sales increased 14%, with 9% core sales growth
and a 6% contribution from acquisitions, partially offset by a
slight headwind from unfavorable foreign exchange. Operating profit
of $97 million increased 53% compared to last year, and adjusted
operating profit of $103 million increased 22% compared to last
year, in both cases primarily reflecting the impact from
productivity, favorable volumes and net price, partially offset by
unfavorable mix.
Summary of Second Quarter 2024 Results
Second Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$581
$510
$
72
14
%
Core sales
44
9
%
Acquisitions
29
6
%
Foreign exchange
(1
)
0
%
Operating profit
$97
$63
$
34
53
%
Adjusted operating profit*
$103
$84
$
19
22
%
Operating profit margin
16.6%
12.4%
420bps
Adjusted operating profit margin*
17.7%
16.5%
120bps
*Please see the attached Non-GAAP
Financial Measures tables
Cash Flow, Financing Activities and Other Financial
Metrics
During the second quarter of 2024, cash provided by operating
activities was $62 million, capital expenditures were $7 million,
and free cash flow (cash provided by operating activities less
capital spending) was $55 million. Adjusted free cash flow (free
cash flow excluding transaction related cash outflows) was $57
million. (Please see the attached non-GAAP Financial Measures
tables.)
As of June 30, 2024, the Company's cash balance was $229 million
with total debt of $377 million.
Rich Maue, Crane's Executive Vice President and Chief Financial
Officer, added: "We ended the quarter with a strong balance sheet
and leverage remains low, providing us with significant capital
deployment optionality."
Second Quarter 2024 Segment Results
All comparisons detailed in this section refer to operating
results for the second quarter 2024 versus the second quarter
2023.
Aerospace & Electronics
Second Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$
231
$
189
$
42
22
%
Core sales
31
16
%
Acquisitions
11
6
%
Operating profit
$
53
$
38
$
14
38
%
Adjusted operating profit*
$
55
$
38
$
17
43
%
Operating profit margin
22.8
%
20.2
%
260bps
Adjusted operating profit margin*
23.8
%
20.2
%
360bps
*Please see the attached Non-GAAP
Financial Measures tables
Sales of $231 million increased 22% compared to the prior year,
driven by 16% core sales growth and a 6% benefit from the
previously announced Vian acquisition. Operating profit margin of
22.8% increased 260 basis points from last year, primarily
reflecting the impact of higher volumes and productivity. Adjusted
operating profit margin of 23.8% increased 360 basis points from
last year. Aerospace & Electronics' order backlog was $815
million as of June 30, 2024 compared to $701 million as of December
31, 2023, and $675 million as of June 30, 2023.
Process Flow Technologies
Second Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$
298
$
263
$
35
13
%
Core sales
17
7
%
Foreign exchange
(1
)
0
%
Acquisitions
18
7
%
Operating profit
$
60
$
51
$
9
18
%
Adjusted operating profit*
$
61
$
53
$
8
16
%
Operating profit margin
20.0
%
19.2
%
80bps
Adjusted operating profit margin*
20.5
%
20.0
%
50bps
*Please see the attached Non-GAAP
Financial Measures tables
Sales of $298 million increased 13% compared to the prior year,
driven by 7% core sales growth and a 7% benefit from the previously
announced Baum and CryoWorks acquisitions. Operating profit margin
expanded 80 basis points to 20.0% primarily due to the impact from
productivity, favorable net price, and higher volumes, partially
offset by unfavorable mix. Adjusted operating profit margin
expanded 50 basis points to 20.5% from last year. Process Flow
Technologies order backlog was $400 million as of June 30, 2024
compared to $379 million as of December 31, 2023, and $353 million
as of June 30, 2023.
Engineered Materials
Second Quarter
Change
(unaudited, dollars in millions)
2024
2023
$
%
Net sales
$
53
$
57
$
(5
)
(8
%)
Operating profit
$
7
$
10
$
(3
)
(26
%)
Adjusted operating profit*
$
7
$
10
$
(2
)
(23
%)
Operating profit margin
13.9
%
17.1
%
(320bps)
Adjusted operating profit margin*
13.9
%
16.6
%
(270bps)
*Please see the attached Non-GAAP
Financial Measures tables
Sales of $53 million decreased 8% compared to the prior year.
Operating profit margin declined 320 basis points to 13.9%, and
adjusted operating profit margin declined 270 basis points to
13.9%, primarily driven by lower volumes.
Updating 2024 Guidance
We are raising the midpoint of our full-year adjusted EPS
guidance by $0.15 and narrowing the adjusted EPS outlook to a range
of $4.95 to $5.15, from the prior range of $4.75 to $5.05.
Key assumptions for our revised guidance include:
- Total sales growth of approximately 11% (prior 10%) driven by
core sales growth of approximately 5% to 7% (prior 4% to 6%) and an
acquisition benefit of approximately 5% (unchanged).
- Adjusted segment operating margin of ~20.7% (prior 20.5%).
- Corporate cost of $80 million (prior $75 million).
- Net non-operating expense of $20 million (prior $23
million).
- Adjusted tax rate of 23.0% (prior 23.5%).
- Diluted shares of ~58 million (unchanged).
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.
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 second
quarter financial results on Tuesday, July 30, 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. 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 and its
subsidiaries file 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
June 30,
Six Months Ended
June 30,
2024
2023
2024
2023
Net
sales:
Aerospace & Electronics
$
230.9
$
189.2
$
456.8
$
369.3
Process Flow Technologies
297.7
263.2
582.0
534.6
Engineered Materials
52.6
57.2
107.7
119.5
Total net sales
$
581.2
$
509.6
$
1,146.5
$
1,023.4
Operating
profit:
Aerospace & Electronics
$
52.7
$
38.3
$
101.0
$
75.9
Process Flow Technologies
59.5
50.6
116.4
113.9
Engineered Materials
7.3
9.8
15.4
21.2
Corporate
(22.9
)
(35.6
)
(46.8
)
(70.4
)
Total operating profit
$
96.6
$
63.1
$
186.0
$
140.6
Interest income
$
1.3
$
0.8
$
2.5
$
1.7
Interest expense
(7.4
)
(5.3
)
(14.6
)
(11.8
)
Miscellaneous income (expense), net
1.1
(1.3
)
(0.2
)
(1.9
)
Income from continuing operations before
income taxes
91.6
57.3
173.7
128.6
Provision for income taxes
20.0
14.0
37.3
29.4
Net income from continuing operations
attributable to common shareholders
71.6
43.3
136.4
99.2
Income from discontinued operations, net
of tax
—
2.3
—
52.1
Net income attributable to common
shareholders
$
71.6
$
45.6
$
136.4
$
151.3
Earnings per diluted share from continuing
operations
$
1.23
$
0.75
$
2.34
$
1.73
Earnings per diluted share from
discontinued operations
—
0.04
—
0.91
Earnings per diluted share
$
1.23
$
0.79
$
2.34
$
2.64
Average diluted shares outstanding
58.3
57.4
58.2
57.4
Average basic shares outstanding
57.2
56.7
57.1
56.6
Supplemental
data:
Cost of sales
$
357.3
$
308.5
$
702.1
$
615.4
Selling, general & administrative
127.3
138.0
258.4
267.4
Transaction related expenses (a)
5.9
19.2
12.7
32.2
Repositioning related charges, net (a)
0.1
1.7
0.5
2.0
Depreciation and amortization (a)
13.8
9.8
26.7
19.0
Stock-based compensation expense (a)
6.9
8.4
13.5
14.0
(a) Amounts included within Cost of sales
and/or Selling, general & administrative costs.
CRANE COMPANY
Condensed Balance
Sheets
(unaudited, in millions)
June 30,
2024
December 31,
2023
Assets
Current assets
Cash and cash equivalents
$
229.3
$
329.6
Accounts receivable, net
370.9
306.4
Inventories, net
389.6
353.1
Other current assets
119.4
101.7
Total current assets
1,109.2
1,090.8
Property, plant and equipment, net
273.6
270.5
Other assets
299.8
224.6
Goodwill
824.1
747.7
Total assets
$
2,506.7
$
2,333.6
Liabilities and Equity
Current liabilities
Short-term borrowings
$
130.0
$
—
Accounts payable
157.4
179.1
Accrued liabilities
229.3
273.7
Income taxes
3.9
14.3
Total current liabilities
520.6
467.1
Long-term debt
246.9
248.5
Long-term deferred tax liability
49.1
37.1
Other liabilities
214.4
220.6
Total liabilities
1,031.0
973.3
Total equity
1,475.7
1,360.3
Total liabilities and equity
$
2,506.7
$
2,333.6
CRANE COMPANY
Condensed Statements of Cash
Flows
(unaudited, in millions)
Three Months Ended
June 30,
Six Months Ended
June 30,
2024
2023
2024
2023
Operating activities:
Net income attributable to common
shareholders
$
71.6
$
45.6
$
136.4
$
151.3
Less: Income from discontinued operations,
net of tax
—
2.3
—
52.1
Net income from continuing operations
attributable to common shareholders
71.6
43.3
136.4
99.2
Depreciation and amortization
13.8
9.8
26.7
19.0
Stock-based compensation expense
6.9
8.4
13.5
14.0
Defined benefit plans and postretirement
cost
1.0
1.9
1.9
4.8
Deferred income taxes
(0.1
)
(5.3
)
—
(3.7
)
Cash (used for) provided by operating
working capital
(24.0
)
1.3
(186.4
)
(183.3
)
Defined benefit plans and postretirement
contributions
(5.4
)
(5.4
)
(6.0
)
(5.7
)
Environmental payments, net of
reimbursements
(1.4
)
(0.6
)
(2.8
)
(1.9
)
Other
(0.4
)
(1.0
)
(1.2
)
4.6
Total provided by (used for) operating
activities from continuing operations
62.0
52.4
(17.9
)
(53.0
)
Investing activities:
Payment for acquisition - net of cash
acquired
(60.7
)
—
(166.3
)
—
Capital expenditures
(7.4
)
(11.6
)
(16.5
)
(20.5
)
Other investing activities
5.5
(0.5
)
5.7
(0.3
)
Total used for investing activities from
continuing operations
(62.6
)
(12.1
)
(177.1
)
(20.8
)
Financing activities:
Dividends paid
(11.7
)
(10.2
)
(23.4
)
(36.8
)
Net proceeds (payments) related to
employee stock plans
3.4
0.8
(5.1
)
13.7
Debt issuance costs
—
(3.4
)
—
(7.5
)
Proceeds from long-term debt
50.0
300.0
190.0
300.0
Proceeds from term facility of
discontinued operations
—
—
—
350.0
Repayments of long-term debt
(30.0
)
(36.9
)
(61.9
)
(436.9
)
Distribution of Crane NXT, Co.
—
(578.1
)
—
(578.1
)
Total provided by (used for) financing
activities from continuing and discontinued operations
11.7
(327.8
)
99.6
(395.6
)
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
(1.2
)
(3.8
)
(4.9
)
0.2
Increase (decrease) in cash and cash
equivalents
9.9
(291.3
)
(100.3
)
(438.7
)
Cash and cash equivalents at beginning of
period (a)
219.4
510.2
329.6
657.6
Cash and cash equivalents at end of
period
$
229.3
$
218.9
$
229.3
$
218.9
(a) 2023 Includes cash and cash
equivalents of discontinued operations.
CRANE COMPANY
Order Backlog
(unaudited, in millions)
June 30,
March 31,
December 31,
September 30,
June 30,
2024
2024
2023
2023
2023
Aerospace & Electronics (a)
$
814.9
$
791.8
$
700.9
$
677.9
$
675.1
Process Flow Technologies(b) (c)
399.9
393.3
379.0
352.9
352.9
Engineered Materials
11.0
12.8
11.3
14.6
14.5
Total backlog
$
1,225.8
$
1,197.9
$
1,091.2
$
1,045.4
$
1,042.5
(a) Includes $62.3 million and $53.5 million of backlog as of
June 30, 2024 and March 31, 2024, respectively, pertaining to the
Vian acquisition.
(b) Includes $11.6 million of backlog as of June 30, 2024
pertaining to the CryoWorks acquisition.
(c) Includes $6.4 million, $8.3 million and $11.5 million of
backlog as of 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 June
30,
2024
2023
% Change
$
Per Share
$
Per Share
(on $)
Net sales (GAAP)
$
581.2
$
509.6
14.1
%
Adjusted Operating Profit and Adjusted
Operating Profit Margin
Operating profit (GAAP)
$
96.6
$
63.1
53.1
%
Operating profit margin (GAAP)
16.6
%
12.4
%
Special items impacting operating
profit:
Transaction related expenses(a)(b)
5.9
19.2
Repositioning related charges, net
0.1
1.7
Adjusted operating profit (Non-GAAP)
$
102.6
$
84.0
22.1
%
Adjusted operating profit margin
(Non-GAAP)
17.7
%
16.5
%
Adjusted Net Income and Adjusted Net
Income per Share
Net income from continuing operations
attributable to common shareholders (GAAP)
$
71.6
$
1.23
$
43.3
$
0.75
65.4
%
Transaction related expenses(a)(b)
5.3
0.09
19.2
0.33
Repositioning related charges, net
0.1
—
1.7
0.03
Impact of pension non-service costs
(0.3
)
—
1.5
0.03
Tax effect of the Non-GAAP adjustments
(1.2
)
(0.02
)
(2.3
)
(0.04
)
Adjusted net income (Non-GAAP)
$
75.5
$
1.30
$
63.4
$
1.10
19.1
%
Adjusted EBITDA and Adjusted EBITDA
Margin
Net income (GAAP)
$
71.6
$
43.3
65.4
%
Net income margin (GAAP)
12.3
%
8.5
%
Adjustments to net income:
Interest expense, net
6.1
4.5
Income tax expense
20.0
14.0
Depreciation
9.5
8.0
Amortization
4.3
1.8
Miscellaneous (income) expense, net
(1.1
)
1.3
Repositioning related charges, net
0.1
1.7
Transaction related expenses(a)(b)
2.5
19.2
Adjusted EBITDA (Non-GAAP)
$
113.0
$
93.8
20.5
%
Adjusted EBITDA Margin (Non-GAAP)
19.4
%
18.4
%
(a) 2024 transaction-related expenses
primarily associated with the Vian and CryoWorks acquisitions.
(b) 2023 transaction-related expenses
primarily associated with the separation.
Totals may not sum due to rounding
CRANE COMPANY
Non-GAAP Financial
Measures
(in millions, except per share
data)
Six Months Ended June
30,
2024
2023
% Change
$
Per Share
$
Per Share
(on $)
Net sales (GAAP)
$
1,146.5
$
1,023.4
12.0
%
Adjusted Operating Profit and Adjusted
Operating Profit Margin
Operating profit (GAAP)
$
186.0
$
140.6
32.3
%
Operating profit margin (GAAP)
16.2
%
13.7
%
Special items impacting operating
profit:
Transaction related expenses(a)(b)
12.7
32.2
Repositioning related charges, net
0.5
2.0
Adjusted operating profit (Non-GAAP)
$
199.2
$
174.8
14.0
%
Adjusted operating profit margin
(Non-GAAP)
17.4
%
17.1
%
Adjusted Net Income and Adjusted Net
Income per Share
Net income from continuing operations
attributable to common shareholders (GAAP)
$
136.4
$
2.34
$
99.2
$
1.73
37.5
%
Transaction related expenses(a)(b)
12.1
0.21
32.2
0.56
Repositioning related charges, net
0.5
0.01
2.0
0.03
Impact of pension non-service costs
0.3
—
2.9
0.05
Interest expense
—
—
5.9
0.10
Tax effect of the Non-GAAP adjustments
(2.7
)
(0.04
)
(6.6
)
(0.11
)
Adjusted net income (Non-GAAP)
$
146.6
$
2.52
$
135.6
$
2.36
8.1
%
Adjusted EBITDA and Adjusted EBITDA
Margin
Net income (GAAP)
$
136.4
$
99.2
37.5
%
Net income margin (GAAP)
11.9
%
9.7
%
Adjustments to net income:
Interest expense, net
12.1
10.2
Income tax expense
37.3
29.4
Depreciation
18.5
16.0
Amortization
8.2
3.0
Miscellaneous expense, net
0.2
1.8
Repositioning related charges, net
0.5
2.0
Transaction related expenses(a)(b)
9.3
32.2
Adjusted EBITDA (Non-GAAP)
$
222.5
$
193.8
14.8
%
Adjusted EBITDA Margin (Non-GAAP)
19.4
%
18.9
%
(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.
Totals may not sum due to rounding
CRANE COMPANY
Non-GAAP Financial Measures by
Segment
(unaudited, in millions)
Three Months Ended June 30,
2024
Aerospace &
Electronics
Process Flow
Technologies
Engineered
Materials
Corporate
Total
Company
Net sales
$
230.9
$
297.7
$
52.6
$
—
$
581.2
Operating profit (GAAP)
$
52.7
$
59.5
$
7.3
$
(22.9
)
$
96.6
Operating profit margin (GAAP)
22.8
%
20.0
%
13.9
%
16.6
%
Special items impacting operating
profit:
Transaction related expenses(a)
2.2
1.3
—
2.4
5.9
Repositioning related charges, net
—
0.1
—
—
0.1
Adjusted operating profit (Non-GAAP)
$
54.9
$
60.9
$
7.3
$
(20.5
)
$
102.6
Adjusted operating profit margin
(Non-GAAP)
23.8
%
20.5
%
13.9
%
17.7
%
Three Months Ended June 30,
2023
Net sales
$
189.2
$
263.2
$
57.2
$
—
$
509.6
Operating profit (GAAP)
$
38.3
$
50.6
$
9.8
$
(35.6
)
$
63.1
Operating profit margin (GAAP)
20.2
%
19.2
%
17.1
%
12.4
%
Special items impacting operating
profit:
Transaction related expenses(b)
—
—
—
19.2
19.2
Repositioning related charges, net
—
2.0
(0.3
)
—
1.7
Adjusted operating profit (Non-GAAP)
$
38.3
$
52.6
$
9.5
$
(16.4
)
$
84.0
Adjusted operating profit margin
(Non-GAAP)
20.2
%
20.0
%
16.6
%
16.5
%
(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.
Totals may not sum due to rounding
CRANE COMPANY
Non-GAAP Financial Measures by
Segment
(in millions)
Six Months Ended June 30, 2024
Aerospace &
Electronics
Process Flow
Technologies
Engineered
Materials
Corporate
Total
Company
Net sales
$
456.8
$
582.0
$
107.7
$
—
$
1,146.5
Operating profit (GAAP)
$
101.0
$
116.4
$
15.4
$
(46.8
)
$
186.0
Operating profit margin (GAAP)
22.1
%
20.0
%
14.3
%
16.2
%
Special items impacting operating
profit:
Transaction related expenses(a)
4.6
3.2
—
4.9
12.7
Repositioning related charges , net
—
0.5
—
—
0.5
Adjusted operating profit (Non-GAAP)
$
105.6
$
120.1
$
15.4
$
(41.9
)
$
199.2
Adjusted operating profit margin
(Non-GAAP)
23.1
%
20.6
%
14.3
%
17.4
%
Six Months Ended June 30, 2023
Net sales
$
369.3
$
534.6
$
119.5
$
—
$
1,023.4
Operating profit (GAAP)
$
75.9
$
113.9
$
21.2
$
(70.4
)
$
140.6
Operating profit margin (GAAP)
20.6
%
21.3
%
17.7
%
13.7
%
Special items impacting operating
profit:
Transaction related expenses(b)
—
—
—
32.2
32.2
Repositioning related charges, net
—
2.3
(0.3
)
—
2.0
Adjusted operating profit (Non-GAAP)
$
75.9
$
116.2
$
20.9
$
(38.2
)
$
174.8
Adjusted operating profit margin
(Non-GAAP)
20.6
%
21.7
%
17.5
%
17.1
%
(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.
Totals may not sum due to rounding
CRANE COMPANY
Adjusted Free Cash
Flow
(unaudited, in millions, except
per share data)
Three Months Ended
June 30,
Six Months Ended
June 30,
Cash Flow Items
2024
2023
2024
2023
Cash provided by (used for) operating
activities from continuing operations
$
62.0
$
52.4
$
(17.9
)
$
(53.0
)
Less: Capital expenditures
(7.4
)
(11.6
)
(16.5
)
(20.5
)
Free cash flow
$
54.6
$
40.8
$
(34.4
)
$
(73.5
)
Adjustments:
Transaction-related expenses
$
2.4
$
19.2
$
5.1
$
32.2
Adjusted free cash flow
$
57.0
$
60.0
$
(29.3
)
$
(41.3
)
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/20240729497894/en/
Jason D. Feldman Senior Vice President, Investor Relations,
Treasury & Tax Allison Poliniak-Cusic Vice President, Investor
Relations IR@Craneco.com www.craneco.com
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