Parker Hannifin Corporation (NYSE: PH), the global leader in motion
and control technologies, today reported results for the fiscal
2024 second quarter ended December 31, 2023. Sales were a
record at $4.8 billion, an increase of 3%, compared with $4.7
billion in the second quarter of fiscal 2023. Net income was $681.9
million compared with $395.2 million in the prior year quarter.
Adjusted net income was $802.4 million, an increase of 30% compared
with $618.9 million in the second quarter of fiscal 2023. Earnings
per share were $5.23 compared with $3.04 in the prior year quarter.
Adjusted earnings per share increased 29% to $6.15 compared with
$4.76 in the second quarter of fiscal 2023. Fiscal 2024
year-to-date cash flow from operations increased 26% to $1.4
billion, or 14.0% of sales, compared with $1.1 billion, or 12.1% of
sales, in the prior year. A reconciliation of non-GAAP measures is
included in the financial tables of this press release.
“We continue to produce exceptional results that reflect the
strength of our portfolio and our ability to execute at a high
level, underpinned by our business system, The Win Strategy™,” said
Chairman and Chief Executive Officer, Jenny Parmentier. “Our
adjusted operating margin increased by 300 basis points
year-over-year, as we saw meaningful margin improvement in every
segment. Strong aerospace and defense results, including synergies
from the Meggitt acquisition, were a key driver of performance in
the quarter. We continued to generate strong cash flow and direct
it towards reducing debt. Our results are a testament to the
dedication and persistence of our global teams.”
Segment ResultsDiversified Industrial Segment:
North American second quarter sales decreased 1% to $2.1 billion
and operating income was $461.9 million compared with $419.9
million in the same period a year ago. On an adjusted basis, North
American operating income was $510.4 million, or 24.2% of sales, a
240 basis point increase compared with the second quarter of fiscal
2023. International second quarter sales were flat at $1.4 billion
and operating income was $290.5 million compared with $285.5
million in the same period a year ago. On an adjusted basis,
International operating income was $323.4 million, or 23.0% of
sales, a 110 basis point increase compared with the prior year
quarter.
Aerospace Systems Segment: Second quarter sales increased 15% to
$1.3 billion and operating income was $263.1 million compared with
$8.8 million in the same period a year ago. On an adjusted basis,
operating income was $346.9 million, or 26.5% of sales, a 590 basis
point increase compared with the prior year quarter.
OrdersThe company reported the following orders
for the quarter ending December 31, 2023, compared with the
same quarter a year ago:
- Orders increased 2% for total Parker
- Orders decreased 4% in the Diversified Industrial North America
businesses
- Orders decreased 5% in the Diversified Industrial International
businesses
- Orders increased 21% in the Aerospace Systems Segment on a
rolling 12-month average basis.
OutlookParker's outlook for the fiscal year
ending June 30, 2024 has been updated. The company expects total
sales growth in fiscal 2024 to be in the range of 3% to 5%; total
segment operating margin in the range of 20.7% to 21.1%, or 24.1%
to 24.5% on an adjusted basis; and earnings per share in the range
of $20.00 to $20.60, or $23.90 to $24.50 on an adjusted basis.
Reconciliations of forecasted segment operating margin to adjusted
forecasted segment operating margin and forecasted earnings per
share to adjusted forecasted earnings per share are included in the
financial tables of this press release.
Parmentier added, “We are increasing our outlook for fiscal 2024
and expect another year of record performance. We will continue to
stay focused on executing the Win Strategy and leveraging the
growth in aerospace markets. Our future looks very bright supported
by favorable secular growth trends and further opportunities to
improve our customer experience.”
NOTICE OF WEBCAST: Parker Hannifin's webcast to
discuss its fiscal 2024 second quarter results is available to all
interested parties via live webcast today at 11:00 a.m. ET, at
www.phstock.com. A replay of the webcast will be available on the
site approximately one hour after the completion of the call and
will remain available for one year. To register for e-mail
notification of future events please visit
www.phstock.com.
About Parker HannifinParker Hannifin is a
Fortune 250 global leader in motion and control technologies. For
more than a century the company has been enabling engineering
breakthroughs that lead to a better tomorrow. Parker has increased
its annual dividend per share paid to shareholders for 67
consecutive fiscal years, among the top five longest-running
dividend-increase records in the S&P 500 index. Learn more at
www.parker.com or @parkerhannifin.
Note on OrdersOrders provide near-term
perspective on the company's outlook, particularly when viewed in
the context of prior and future quarterly order rates. However,
orders are not in themselves an indication of future performance.
All comparisons are at constant currency exchange rates, with the
prior year restated to the current-year rates. Beginning in the
third quarter of fiscal 2023, all comparisons include acquisitions
in both the numerator and denominator and exclude divestitures.
Diversified Industrial comparisons are on 3-month average
computations and Aerospace Systems comparisons are on rolling
12-month average computations.
Note on Net IncomeNet income referenced in this
press release is equal to net income attributable to common
shareholders.
Note on Non-GAAP Financial MeasuresThis press
release contains references to non-GAAP financial information
including (a) adjusted net income; (b) adjusted earnings per share;
(c) adjusted segment operating margins; (d) adjusted segment
operating income; and (e) organic sales growth. The adjusted net
income, earnings per share, segment operating margin, segment
operating income and organic sales measures are presented to allow
investors and the company to meaningfully evaluate changes in net
income, earnings per share and segment operating margins on a
comparable basis from period to period. Comparable descriptions of
record adjusted results in this release refer only to the period
from the first quarter of FY2011 to the periods presented in this
release. This period coincides with recast historical financial
results provided in association with our FY2014 change in segment
reporting. A reconciliation of non-GAAP measures is included in the
financial tables of this press release.
Forward-Looking StatementsForward-looking
statements contained in this and other written and oral reports are
made based on known events and circumstances at the time of
release, and as such, are subject in the future to unforeseen
uncertainties and risks. Often but not always, these statements may
be identified from the use of forward-looking terminology such as
“anticipates,” “believes,” “may,” “should,” “could,” “expects,”
“targets,” “is likely,” “will,” or the negative of these terms and
similar expressions, and include all statements regarding future
performance, earnings projections, events or developments. Neither
Parker nor any of its respective associates or directors, officers
or advisers, provides any representation, assurance or guarantee
that the occurrence of the events expressed or implied in any
forward-looking statements will actually occur. Parker cautions
readers not to place undue reliance on these statements. It is
possible that the future performance and earnings projections of
the company, including its individual segments, may differ
materially from past performance or current expectations.
Among other factors which may affect future performance are:
changes in business relationships with and purchases by or from
major customers, suppliers or distributors, including delays or
cancellations in shipments; disputes regarding contract terms or
significant changes in financial condition, changes in contract
cost and revenue estimates for new development programs and changes
in product mix; ability to identify acceptable strategic
acquisition targets; uncertainties surrounding timing, successful
completion or integration of acquisitions and similar transactions,
including the integration of Meggitt PLC; the ability to
successfully divest businesses planned for divestiture and realize
the anticipated benefits of such divestitures; the determination to
undertake business realignment activities and the expected costs
thereof and, if undertaken, the ability to complete such activities
and realize the anticipated cost savings from such activities;
ability to implement successfully business and operating
initiatives, including the timing, price and execution of share
repurchases and other capital initiatives; availability, cost
increases of or other limitations on our access to raw materials,
component products and/or commodities if associated costs cannot be
recovered in product pricing; ability to manage costs related to
insurance and employee retirement and health care benefits; legal
and regulatory developments and changes; compliance costs
associated with environmental laws and regulations; potential
supply chain and labor disruptions, including as a result of labor
shortages; threats associated with international conflicts and
efforts to combat terrorism and cyber security risks; uncertainties
surrounding the ultimate resolution of outstanding legal
proceedings, including the outcome of any appeals; local and global
political and competitive market conditions, including global
reactions to U.S. trade policies, and resulting effects on sales
and pricing; global economic factors, including manufacturing
activity, air travel trends, currency exchange rates, difficulties
entering new markets and general economic conditions such as
inflation, deflation, interest rates (including fluctuations
associated with any potential credit rating decline) and credit
availability; inability to obtain, or meet conditions imposed for,
required governmental and regulatory approvals; changes in consumer
habits and preferences; government actions, including the impact of
changes in the tax laws in the United States and foreign
jurisdictions and any judicial or regulatory interpretation
thereof; large scale disasters, such as floods, earthquakes,
hurricanes, industrial accidents and pandemics. Readers should
consider these forward-looking statements in light of risk factors
discussed in Parker’s Annual Report on Form 10-K for the fiscal
year ended June 30, 2023 and other periodic filings made with the
SEC.
PARKER
HANNIFIN CORPORATION - DECEMBER 31, 2023 |
|
|
|
|
CONSOLIDATED STATEMENT OF INCOME |
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Dollars in
thousands, except per share amounts) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net sales |
|
$ |
4,820,947 |
|
|
$ |
4,674,811 |
|
|
$ |
9,668,435 |
|
|
$ |
8,907,586 |
|
Cost of sales |
|
|
3,101,962 |
|
|
|
3,236,812 |
|
|
|
6,199,311 |
|
|
|
6,032,268 |
|
Selling, general
and administrative expenses |
|
806,802 |
|
|
|
814,966 |
|
|
|
1,680,493 |
|
|
|
1,650,770 |
|
Interest expense |
|
|
129,029 |
|
|
|
146,931 |
|
|
|
263,497 |
|
|
|
264,725 |
|
Other income, net |
|
|
(85,011 |
) |
|
|
(40,641 |
) |
|
|
(163,466 |
) |
|
|
(60,265 |
) |
Income before income
taxes |
|
|
868,165 |
|
|
|
516,743 |
|
|
|
1,688,600 |
|
|
|
1,020,088 |
|
Income taxes |
|
|
186,108 |
|
|
|
121,282 |
|
|
|
355,471 |
|
|
|
236,590 |
|
Net income |
|
|
682,057 |
|
|
|
395,461 |
|
|
|
1,333,129 |
|
|
|
783,498 |
|
Less: Noncontrolling
interests |
|
|
206 |
|
|
|
224 |
|
|
|
451 |
|
|
|
407 |
|
Net income
attributable to common shareholders |
$ |
681,851 |
|
|
$ |
395,237 |
|
|
$ |
1,332,678 |
|
|
$ |
783,091 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
per share attributable to common shareholders: |
|
|
|
|
|
|
|
Basic earnings per share |
|
$ |
5.31 |
|
|
$ |
3.08 |
|
|
$ |
10.38 |
|
|
$ |
6.10 |
|
Diluted earnings per
share |
|
$ |
5.23 |
|
|
$ |
3.04 |
|
|
$ |
10.23 |
|
|
$ |
6.03 |
|
|
|
|
|
|
|
|
|
|
Average shares
outstanding during period - Basic |
|
128,426,247 |
|
|
|
128,313,322 |
|
|
|
128,449,398 |
|
|
|
128,369,162 |
|
Average shares
outstanding during period - Diluted |
|
130,367,351 |
|
|
|
130,045,013 |
|
|
|
130,314,326 |
|
|
|
129,961,696 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
DIVIDENDS PER COMMON SHARE |
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Amounts in dollars) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Cash
dividends per common share |
$ |
1.48 |
|
|
$ |
1.33 |
|
|
$ |
2.96 |
|
|
$ |
2.66 |
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF ORGANIC GROWTH |
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Sales growth - as
reported |
|
3.1 |
% |
|
22.2 |
% |
|
8.5 |
% |
|
17.4 |
% |
Adjustments: |
|
|
|
|
|
|
|
Acquisitions |
|
— |
% |
|
16.5 |
% |
|
5.6 |
% |
|
10.2 |
% |
Divestitures |
|
(0.3)% |
|
(0.5)% |
|
(0.4)% |
|
(0.3)% |
Currency |
0.5 |
% |
|
(4.1)% |
|
0.7 |
% |
|
(4.7)% |
Organic sales
growth |
|
2.9 |
% |
|
10.3 |
% |
|
2.6 |
% |
|
12.2 |
% |
PARKER
HANNIFIN CORPORATION - DECEMBER 31, 2023 |
|
|
|
|
|
|
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO COMMON
SHAREHOLDERS TO ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON
SHAREHOLDERS |
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net income
attributable to common shareholders |
$ |
681,851 |
|
|
$ |
395,237 |
|
|
$ |
1,332,678 |
|
|
$ |
783,091 |
|
Adjustments: |
|
|
|
|
|
|
|
Acquired intangible asset amortization expense |
|
142,027 |
|
|
|
142,256 |
|
|
|
297,547 |
|
|
|
229,270 |
|
Business realignment charges |
|
14,354 |
|
|
|
5,378 |
|
|
|
27,446 |
|
|
|
9,239 |
|
Integration costs to achieve |
|
|
10,014 |
|
|
|
33,418 |
|
|
|
16,420 |
|
|
|
45,409 |
|
Acquisition-related expenses |
|
— |
|
|
|
1,983 |
|
|
|
— |
|
|
|
162,241 |
|
Loss on deal-contingent forward contracts |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
389,992 |
|
Net gain on divestitures |
|
(12,391 |
) |
|
|
— |
|
|
|
(25,651 |
) |
|
|
(372,930 |
) |
Amortization of inventory step-up to fair value |
|
— |
|
|
|
111,973 |
|
|
|
— |
|
|
|
130,331 |
|
Tax effect of adjustments1 |
|
|
(33,476 |
) |
|
|
(71,391 |
) |
|
|
(69,624 |
) |
|
|
(142,246 |
) |
Adjusted
net income attributable to common shareholders |
$ |
802,379 |
|
|
$ |
618,854 |
|
|
$ |
1,578,816 |
|
|
$ |
1,234,397 |
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF EARNINGS PER DILUTED SHARE TO ADJUSTED
EARNINGS PER DILUTED SHARE |
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Amounts in dollars) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Earnings
per diluted share |
$ |
5.23 |
|
|
$ |
3.04 |
|
|
$ |
10.23 |
|
|
$ |
6.03 |
|
Adjustments: |
|
|
|
|
|
|
|
Acquired intangible asset amortization expense |
|
1.09 |
|
|
|
1.09 |
|
|
|
2.28 |
|
|
|
1.76 |
|
Business realignment charges |
|
0.11 |
|
|
|
0.04 |
|
|
|
0.21 |
|
|
|
0.07 |
|
Integration costs to achieve |
|
0.08 |
|
|
|
0.26 |
|
|
|
0.13 |
|
|
|
0.35 |
|
Acquisition-related expenses |
|
— |
|
|
|
0.02 |
|
|
|
— |
|
|
|
1.26 |
|
Loss on deal-contingent forward contracts |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3.00 |
|
Net gain on divestitures |
|
(0.10 |
) |
|
|
— |
|
|
|
(0.20 |
) |
|
|
(2.87 |
) |
Amortization of inventory step-up to fair value |
|
— |
|
|
|
0.86 |
|
|
|
— |
|
|
|
1.00 |
|
Tax effect of adjustments1 |
|
|
(0.26 |
) |
|
|
(0.55 |
) |
|
|
(0.53 |
) |
|
|
(1.09 |
) |
Adjusted
earnings per diluted share |
$ |
6.15 |
|
|
$ |
4.76 |
|
|
$ |
12.12 |
|
|
$ |
9.51 |
|
|
|
|
|
|
|
|
|
|
1This line item
reflects the aggregate tax effect of all non-tax adjustments
reflected in the preceding line items of the table. We estimate the
tax effect of each adjustment item by applying our overall
effective tax rate for continuing operations to the pre-tax amount,
unless the nature of the item and/or the tax jurisdiction in which
the item has been recorded requires application of a specific tax
rate or tax treatment, in which case the tax effect of such item is
estimated by applying such specific tax rate or tax treatment. |
PARKER
HANNIFIN CORPORATION - DECEMBER 31, 2023 |
|
|
|
|
|
|
BUSINESS
SEGMENT INFORMATION |
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
|
2022 |
Net
sales |
|
|
|
|
|
|
|
|
Diversified Industrial: |
|
|
|
|
|
|
|
|
North America |
|
$ |
2,110,203 |
|
|
$ |
2,140,685 |
|
$ |
4,340,109 |
|
|
$ |
4,272,445 |
International |
|
|
1,404,270 |
|
|
|
1,397,699 |
|
|
2,792,892 |
|
|
|
2,752,712 |
Aerospace Systems |
|
|
1,306,474 |
|
|
|
1,136,427 |
|
|
2,535,434 |
|
|
|
1,882,429 |
Total net
sales |
|
$ |
4,820,947 |
|
|
$ |
4,674,811 |
|
$ |
9,668,435 |
|
|
$ |
8,907,586 |
Segment operating
income |
|
|
|
|
|
|
|
|
Diversified Industrial: |
|
|
|
|
|
|
|
|
North America |
|
$ |
461,850 |
|
|
$ |
419,921 |
|
$ |
967,903 |
|
|
$ |
872,907 |
International |
|
|
290,484 |
|
|
|
285,520 |
|
|
591,185 |
|
|
|
579,460 |
Aerospace Systems |
|
|
263,112 |
|
|
|
8,793 |
|
|
489,372 |
|
|
|
100,944 |
Total
segment operating income |
|
1,015,446 |
|
|
|
714,234 |
|
|
2,048,460 |
|
|
|
1,553,311 |
Corporate general
and administrative expenses |
|
49,902 |
|
|
|
48,901 |
|
|
105,558 |
|
|
|
100,561 |
Income before
interest expense and other expense |
|
965,544 |
|
|
|
665,333 |
|
|
1,942,902 |
|
|
|
1,452,750 |
Interest expense |
|
|
129,029 |
|
|
|
146,931 |
|
|
263,497 |
|
|
|
264,725 |
Other (income) expense,
net |
|
|
(31,650 |
) |
|
|
1,659 |
|
|
(9,195 |
) |
|
|
167,937 |
Income before income
taxes |
|
$ |
868,165 |
|
|
$ |
516,743 |
|
$ |
1,688,600 |
|
|
$ |
1,020,088 |
|
|
|
|
|
|
|
|
|
RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED
SEGMENT OPERATING MARGINS |
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Diversified Industrial
North America sales |
|
$ |
2,110,203 |
|
|
$ |
2,140,685 |
|
|
$ |
4,340,109 |
|
|
$ |
4,272,445 |
|
|
|
|
|
|
|
|
|
|
Diversified Industrial
North America operating income |
|
$ |
461,850 |
|
|
$ |
419,921 |
|
|
$ |
967,903 |
|
|
$ |
872,907 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Acquired intangible asset amortization |
|
|
44,699 |
|
|
|
44,358 |
|
|
|
89,382 |
|
|
|
90,632 |
|
Business realignment charges |
|
|
3,250 |
|
|
|
1,338 |
|
|
|
5,834 |
|
|
|
1,471 |
|
Integration costs to achieve |
|
|
562 |
|
|
|
1,270 |
|
|
|
1,507 |
|
|
|
1,317 |
|
Adjusted Diversified
Industrial North America operating income |
|
$ |
510,361 |
|
|
$ |
466,887 |
|
|
$ |
1,064,626 |
|
|
$ |
966,327 |
|
|
|
|
|
|
|
|
|
|
Diversified Industrial
North America operating margin |
|
|
21.9 |
% |
|
|
19.6 |
% |
|
|
22.3 |
% |
|
|
20.4 |
% |
Adjusted Diversified
Industrial North America operating margin |
|
|
24.2 |
% |
|
|
21.8 |
% |
|
|
24.5 |
% |
|
|
22.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - DECEMBER 31, 2023 |
|
|
|
|
|
|
RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED
SEGMENT OPERATING MARGINS |
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Diversified Industrial
International sales |
|
$ |
1,404,270 |
|
|
$ |
1,397,699 |
|
|
$ |
2,792,892 |
|
|
$ |
2,752,712 |
|
|
|
|
|
|
|
|
|
|
Diversified Industrial
International operating income |
|
$ |
290,484 |
|
|
$ |
285,520 |
|
|
$ |
591,185 |
|
|
$ |
579,460 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Acquired intangible asset amortization |
|
|
22,610 |
|
|
|
16,819 |
|
|
|
45,878 |
|
|
|
33,624 |
|
Business realignment charges |
|
|
10,035 |
|
|
|
3,039 |
|
|
|
20,090 |
|
|
|
4,918 |
|
Integration costs to achieve |
|
|
309 |
|
|
|
425 |
|
|
|
503 |
|
|
|
564 |
|
Adjusted Diversified
Industrial International operating income |
|
$ |
323,438 |
|
|
$ |
305,803 |
|
|
$ |
657,656 |
|
|
$ |
618,566 |
|
|
|
|
|
|
|
|
|
|
Diversified Industrial
International operating margin |
|
|
20.7 |
% |
|
|
20.4 |
% |
|
|
21.2 |
% |
|
|
21.1 |
% |
Adjusted Diversified
Industrial International operating margin |
|
|
23.0 |
% |
|
|
21.9 |
% |
|
|
23.5 |
% |
|
|
22.5 |
% |
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Aerospace Systems
sales |
|
$ |
1,306,474 |
|
|
$ |
1,136,427 |
|
|
$ |
2,535,434 |
|
|
$ |
1,882,429 |
|
|
|
|
|
|
|
|
|
|
Aerospace Systems
operating income |
|
$ |
263,112 |
|
|
$ |
8,793 |
|
|
$ |
489,372 |
|
|
$ |
100,944 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Acquired intangible asset amortization |
|
|
74,718 |
|
|
|
81,079 |
|
|
|
162,287 |
|
|
|
105,014 |
|
Business realignment charges |
|
|
(123 |
) |
|
|
1,001 |
|
|
|
330 |
|
|
|
2,850 |
|
Integration costs to achieve |
|
|
9,143 |
|
|
|
31,723 |
|
|
|
14,410 |
|
|
|
43,528 |
|
Amortization of inventory step-up to fair value |
|
|
— |
|
|
|
111,973 |
|
|
|
— |
|
|
|
130,331 |
|
Adjusted Aerospace
Systems operating income |
|
$ |
346,850 |
|
|
$ |
234,569 |
|
|
$ |
666,399 |
|
|
$ |
382,667 |
|
|
|
|
|
|
|
|
|
|
Aerospace Systems
operating margin |
|
|
20.1 |
% |
|
|
0.8 |
% |
|
|
19.3 |
% |
|
|
5.4 |
% |
Adjusted Aerospace
Systems operating margin |
|
|
26.5 |
% |
|
|
20.6 |
% |
|
|
26.3 |
% |
|
|
20.3 |
% |
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
Three Months Ended December 31, |
|
Six Months Ended December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Total net
sales |
|
$ |
4,820,947 |
|
|
$ |
4,674,811 |
|
|
$ |
9,668,435 |
|
|
$ |
8,907,586 |
|
|
|
|
|
|
|
|
|
|
Total segment
operating income |
|
$ |
1,015,446 |
|
|
$ |
714,234 |
|
|
$ |
2,048,460 |
|
|
$ |
1,553,311 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Acquired intangible asset amortization |
|
|
142,027 |
|
|
|
142,256 |
|
|
|
297,547 |
|
|
|
229,270 |
|
Business realignment charges |
|
|
13,162 |
|
|
|
5,378 |
|
|
|
26,254 |
|
|
|
9,239 |
|
Integration costs to achieve |
|
|
10,014 |
|
|
|
33,418 |
|
|
|
16,420 |
|
|
|
45,409 |
|
Amortization of inventory step-up to fair value |
|
|
— |
|
|
|
111,973 |
|
|
|
— |
|
|
|
130,331 |
|
Adjusted total segment
operating income |
|
$ |
1,180,649 |
|
|
$ |
1,007,259 |
|
|
$ |
2,388,681 |
|
|
$ |
1,967,560 |
|
|
|
|
|
|
|
|
|
|
Total segment
operating margin |
|
|
21.1 |
% |
|
|
15.3 |
% |
|
|
21.2 |
% |
|
|
17.4 |
% |
Adjusted total segment
operating margin |
|
|
24.5 |
% |
|
|
21.5 |
% |
|
|
24.7 |
% |
|
|
22.1 |
% |
PARKER
HANNIFIN CORPORATION - DECEMBER 31, 2023 |
|
|
|
|
CONSOLIDATED BALANCE SHEET |
|
|
|
|
|
(Unaudited) |
|
December 31, |
|
June 30, |
|
December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
2023 |
|
|
2022 |
Assets |
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
382,815 |
|
$ |
475,182 |
|
$ |
756,055 |
Marketable securities and
other investments |
|
|
11,053 |
|
|
8,390 |
|
|
21,611 |
Trade accounts receivable,
net |
|
|
2,611,404 |
|
|
2,827,297 |
|
|
2,578,045 |
Non-trade and notes
receivable |
|
|
321,680 |
|
|
309,167 |
|
|
371,474 |
Inventories |
|
|
3,092,923 |
|
|
2,907,879 |
|
|
3,095,722 |
Prepaid expenses and
other |
|
|
309,985 |
|
|
306,314 |
|
|
462,093 |
Total current
assets |
|
|
6,729,860 |
|
|
6,834,229 |
|
|
7,285,000 |
Property, plant and equipment,
net |
|
|
2,905,744 |
|
|
2,865,030 |
|
|
2,839,524 |
Deferred income taxes |
|
|
77,256 |
|
|
81,429 |
|
|
133,348 |
Investments and other
assets |
|
|
1,156,710 |
|
|
1,104,576 |
|
|
1,206,194 |
Intangible assets, net |
|
|
8,153,468 |
|
|
8,450,614 |
|
|
8,387,917 |
Goodwill |
|
|
10,671,897 |
|
|
10,628,594 |
|
|
10,668,904 |
Total
assets |
|
$ |
29,694,935 |
|
$ |
29,964,472 |
|
$ |
30,520,887 |
|
|
|
|
|
|
|
Liabilities and
equity |
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
Notes payable and long-term
debt payable within one year |
|
$ |
3,681,167 |
|
$ |
3,763,175 |
|
$ |
1,994,333 |
Accounts payable, trade |
|
|
1,971,943 |
|
|
2,050,934 |
|
|
1,966,757 |
Accrued payrolls and other
compensation |
|
|
472,243 |
|
|
651,319 |
|
|
453,037 |
Accrued domestic and foreign
taxes |
|
|
302,113 |
|
|
374,571 |
|
|
236,227 |
Other accrued liabilities |
|
|
1,069,607 |
|
|
895,371 |
|
|
1,053,049 |
Total current
liabilities |
|
|
7,497,073 |
|
|
7,735,370 |
|
|
5,703,403 |
Long-term debt |
|
|
8,108,696 |
|
|
8,796,284 |
|
|
12,025,860 |
Pensions and other
postretirement benefits |
|
|
482,752 |
|
|
551,510 |
|
|
807,124 |
Deferred income taxes |
|
|
1,579,197 |
|
|
1,649,674 |
|
|
1,751,321 |
Other liabilities |
|
|
714,838 |
|
|
893,355 |
|
|
898,703 |
Shareholders' equity |
|
|
11,302,578 |
|
|
10,326,888 |
|
|
9,322,380 |
Noncontrolling interests |
|
|
9,801 |
|
|
11,391 |
|
|
12,096 |
Total liabilities and
equity |
|
$ |
29,694,935 |
|
$ |
29,964,472 |
|
$ |
30,520,887 |
|
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - DECEMBER 31, 2023 |
|
|
CONSOLIDATED STATEMENT
OF CASH FLOWS |
|
|
|
|
(Unaudited) |
|
Six Months Ended December 31, |
(Dollars in thousands) |
|
|
2023 |
|
|
|
2022 |
|
Cash flows from
operating activities: |
|
|
|
|
Net income |
|
$ |
1,333,129 |
|
|
$ |
783,498 |
|
Depreciation and
amortization |
|
|
468,165 |
|
|
|
383,725 |
|
Stock incentive plan
compensation |
|
|
108,061 |
|
|
|
89,709 |
|
Gain on sale of
businesses |
|
|
(25,964 |
) |
|
|
(377,251 |
) |
Loss (gain) on disposal of
property, plant and equipment |
|
|
5,097 |
|
|
|
(2,551 |
) |
Gain on marketable
securities |
|
|
(96 |
) |
|
|
(1,354 |
) |
Gain on investments |
|
|
(1,384 |
) |
|
|
(2,929 |
) |
Net change in receivables,
inventories and trade payables |
|
|
(42,804 |
) |
|
|
112,216 |
|
Net change in other assets and
liabilities |
|
|
(407,366 |
) |
|
|
(112,066 |
) |
Other, net |
|
|
(84,851 |
) |
|
|
203,137 |
|
Net cash provided by
operating activities |
|
|
1,351,987 |
|
|
|
1,076,134 |
|
Cash flows from
investing activities: |
|
|
|
|
Acquisitions (net of cash of
$89,704 in 2022) |
|
|
— |
|
|
|
(7,146,110 |
) |
Capital expenditures |
|
|
(204,117 |
) |
|
|
(185,704 |
) |
Proceeds from sale of
property, plant and equipment |
|
|
1,360 |
|
|
|
11,632 |
|
Proceeds from sale of
businesses |
|
|
74,595 |
|
|
|
447,300 |
|
Purchases of marketable
securities and other investments |
|
|
(9,396 |
) |
|
|
(25,198 |
) |
Maturities and sales of
marketable securities and other investments |
|
|
6,880 |
|
|
|
30,594 |
|
Payments of deal-contingent
forward contracts |
|
|
— |
|
|
|
(1,405,418 |
) |
Other |
|
|
(438 |
) |
|
|
251,174 |
|
Net cash used in
investing activities |
|
|
(131,116 |
) |
|
|
(8,021,730 |
) |
Cash flows from
financing activities: |
|
|
|
|
Net payments for common stock
activity |
|
|
(136,394 |
) |
|
|
(119,944 |
) |
Acquisition of noncontrolling
interests |
|
|
(2,883 |
) |
|
|
— |
|
Net (payments for) proceeds
from debt |
|
|
(784,847 |
) |
|
|
1,536,211 |
|
Financing fees paid |
|
|
— |
|
|
|
(8,911 |
) |
Dividends paid |
|
|
(381,115 |
) |
|
|
(342,360 |
) |
Net cash (used in)
provided by financing activities |
|
|
(1,305,239 |
) |
|
|
1,064,996 |
|
Effect of exchange rate
changes on cash |
|
|
(7,999 |
) |
|
|
(11,221 |
) |
Net decrease in cash, cash
equivalents and restricted cash |
|
|
(92,367 |
) |
|
|
(5,891,821 |
) |
Cash, cash equivalents and
restricted cash at beginning of year |
|
|
475,182 |
|
|
|
6,647,876 |
|
Cash and cash
equivalents at end of period |
|
$ |
382,815 |
|
|
$ |
756,055 |
|
|
|
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - DECEMBER 31, 2023 |
|
RECONCILIATION OF FORECASTED SEGMENT OPERATING MARGIN TO
ADJUSTED FORECASTED SEGMENT OPERATING MARGIN |
|
|
|
(Unaudited) |
|
|
(Amounts in percentages) |
|
Fiscal Year 2024 |
Forecasted
segment operating margin |
20.7% to 21.1% |
Adjustments: |
|
Business realignment charges |
0.3% |
|
Costs to achieve |
|
0.2% |
|
Acquisition-related intangible asset amortization expense |
|
2.9% |
|
Adjusted
forecasted segment operating margin |
24.1% to 24.5% |
|
RECONCILIATION OF FORECASTED EARNINGS PER DILUTED SHARE TO
ADJUSTED FORECASTED EARNINGS PER DILUTED SHARE |
|
|
|
(Unaudited) |
|
|
(Amounts in dollars) |
|
Fiscal Year 2024 |
Forecasted
earnings per diluted share |
$20.00 to $20.60 |
Adjustments: |
|
Business realignment charges |
0.54 |
|
Costs to achieve |
|
0.27 |
|
Acquisition-related intangible asset amortization expense |
|
4.45 |
|
Net gain on divestitures |
|
(0.20) |
|
Tax effect of adjustments1 |
|
(1.16) |
|
Adjusted
forecasted earnings per diluted share |
$23.90 to $24.50 |
|
|
|
1This line item
reflects the aggregate tax effect of all non-tax adjustments
reflected in the preceding line items of the table. We estimate the
tax effect of each adjustment item by applying our overall
effective tax rate for continuing operations to the pre-tax amount,
unless the nature of the item and/or the tax jurisdiction in which
the item has been recorded requires application of a specific tax
rate or tax treatment, in which case the tax effect of such item is
estimated by applying such specific tax rate or tax treatment. |
Contact: |
Media - |
|
|
Aidan Gormley - Director,
Global Communications and Branding |
216-896-3258 |
|
aidan.gormley@parker.com |
|
|
|
|
|
Financial Analysts
- |
|
|
Jeff Miller - Vice President,
Investor Relations |
216-896-2708 |
|
jeffrey.miller@parker.com |
|
|
|
|
Stock
Symbol: |
PH - NYSE |
|
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