BADGER METER INC
For the period ended Jun 30, 2024. Filed Jul 22, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Jul 22, 2024
BMI$158.18-0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-04-19.
0000950170-24-045898
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-07-22.
0000950170-24-085171
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 58 previous paragraphs and 66 current paragraphs.
48 unchanged; 10 reworded; 5 added; 0 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 1 previous and 1 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (5)
Current report
Acquisitions
Current report
The Company's net sales for the three months ended June 30, 2024 were $216.7 million, an increase of 23.2% compared to $175.9 million during the same period in 2023. Sales into the utility water market were $190.6 million, an increase of 26.3% from the prior year’s $150.9 million. Utility water net sales grew as a result of increased customer adoption of cellular AMI solutions, including ORION® Cellular endpoint and BEACON® SaaS revenues, as well as increased meter volumes, including both mechanical and ultrasonic meters. Sales of products into the global flow instrumentation end markets were $26.1 million compared to the prior year’s $25.0 million, an increase of 4.5%. Flow instrumentation sales increased as a result of steady order demand within the water-focused end markets and modest growth in other industrial markets.
Current report
Results of Operations - Six Months Ended June 30, 2024
Current report
Net Sales
Reworded paragraphs (10)
Previous wording
Total operating earnings for the three months ended March 31, 2024 were $36.6 million, or 18.6% of sales, compared to $25.0 million, or 15.7% of sales, in the comparable prior year quarter. Gross margin dollars increased $14.4 million, with gross margin as a percent of sales of 39.3%, a decrease from 39.5% in the prior year comparable quarter. Gross margin in the current quarter benefited from increased sales volumes and favorable sales mix offset by inflationary cost increases. Selling, engineering and administration (“SEA”) expenses were $40.6 million or 20.7% of sales in the first quarter of 2024 compared to $37.8 million or 23.7% of sales in the comparable prior year quarter. While the Company made investments in growth-related spending including higher headcount and R&D, the year-over-year improvement in SEA expense as a percent of sales is the result of effective spending controls and higher sales.
Current wording
Total operating earnings for the three months ended June 30, 2024 were $41.5 million, or 19.2% of sales, compared to $29.5 million, or 16.8% of sales, in the comparable prior year quarter. Gross margin dollars increased $15.9 million, with gross margin as a percent of sales of 39.4%, a slight decrease from 39.5% in the prior year comparable quarter. Gross margin in the current quarter benefited from increased sales volumes and favorable sales mix offset by inflationary cost increases. Selling, engineering and administration (“SEA”) expenses were $43.9 million or 20.2% of sales compared to $39.9 million or 22.7% in the comparable prior year quarter. The increase in SEA expenses was the result of continued growth-related spending including higher headcount, merit increases, incentive compensation and R&D expenses. The year-over-year improvement in SEA expense as a percent of sales is the result of effective spending controls and higher sales.
Previous wording
The provision for income taxes as a percentage of earnings before income taxes for the quarter ended March 31, 2024 was 23.5% compared to 24.3% for the comparable prior year period. Interim provisions are based on an estimate of the overall annual rate that can vary due to state taxes, the relationship of foreign and domestic earnings, other credits, allowances and discrete items.
Current wording
The provision for income taxes as a percentage of earnings before income taxes for the quarter ended June 30, 2024 was 23.8% compared to 25.8% for the comparable prior year period. Interim provisions are based on an estimate of the overall annual rate that can vary due to state taxes, the relationship of foreign and domestic earnings, and other credits and allowances.
Previous wording
As a result of the above-mentioned items, net earnings for the three months ended March 31, 2024 were $29.1 million, or $0.99 per diluted share, compared to $19.4 million, or $0.66 per diluted share, for the same period in 2023.
Current wording
As a result of the above-mentioned items, net earnings for the three months ended June 30, 2024 were $33.1 million, or $1.12 per diluted share, compared to $22.5 million, or $0.76 per diluted share, for the same period in 2023.
Previous wording
The Company's net sales for the three months ended March 31, 2024 were $196.3 million compared to $159.1 million during the same period in 2023. Net sales into the utility water market were $170.1 million, an increase of 28.7% from the prior year’s $132.2 million. Utility water net sales grew as a result of increased ultrasonic meter and ORION® Cellular endpoint sales as well as increased BEACON® SaaS revenue. Sales of products into the global flow instrumentation end markets were $26.2 million compared to the prior year’s $26.9 million, a decrease of 2.7%, largely the result of to a difficult prior year comparison which included the benefit of backlog conversion and improved supply chain availability that did not reoccur.
Current wording
The Company's net sales for the six months ended June 30, 2024 were $412.9 million compared to $335.0 million during the same period in 2023. Sales into the utility water market were $360.6 million, an increase of 27.4% from the prior year’s $283.1 million. Utility water net sales grew as a result of increased ultrasonic meter, ORION® Cellular endpoint, and BEACON® SaaS revenues. Sales of products into the global flow instrumentation end markets were $52.3 million compared to the prior year’s $51.9 million, an increase of 0.8%. Flow instrumentation sales increased due to steady demand across the majority of end-markets and applications.
Previous wording
Overall, PWC increased $6.7 million compared to the previous year-end. Receivables at March 31, 2024 increased $8.8 million due to higher sales activity in the first quarter of 2024. Inventories increased $6.8 million due to component cost inflation, higher safety stock levels and increased sales activity. Payables as of March 31, 2024 were $8.8 million higher than the prior year-end due to timing of payments and increased inventory levels.
Current wording
Overall, PWC increased $16.1 million compared to the previous year-end. Receivables at June 30, 2024 increased $22.7 million due to higher sales activity. Inventories increased $7.6 million due to component cost inflation, higher safety stock levels and increased sales activity. Payables at June 30, 2024 were $14.2 million higher than the prior year-end due to timing of payments and increased inventory levels.
Previous wording
Cash provided by operations in the first three months of 2024 was $21.5 million compared to $18.0 million in the same period of 2023. Higher net earnings, offset by higher incentive compensation payments in 2024 versus 2023, contributed to the increase in cash provided by operations compared to the same quarter in 2023.
Current wording
Cash provided by operations in the first six months of 2024 was $57.9 million compared to $40.7 million in the same period of 2023. Higher net earnings, offset by increased working capital balances, contributed to the increase in cash provided by operations compared to the same period in 2023.
Previous wording
Property, plant and equipment expenditures for the first three months of 2024 were $2.7 million compared to $4.3 million in the comparable prior year period.
Current wording
Property, plant and equipment expenditures for the first six months of 2024 were $5.0 million compared to $6.9 million in the comparable prior year period.
Previous wording
Cash and cash equivalents at March 31, 2024 increased to $199.3 million from $191.8 million at December 31, 2023, the result of the $21.5 million of cash provided by operations, offset by $3.0 million deployed to acquire the Telog net assets and payment of the quarterly dividend.
Current wording
Cash and cash equivalents increased to $226.2 million from $191.8 million at December 31, 2023, the result of the $57.9 million cash provided by operations, offset by $3.0 million deployed to acquire the Telog/Unity net assets and payment of quarterly dividends.
Previous wording
On March 6, 2024, the SEC adopted final rules to enhance disclosures pertaining to climate related risks and associated board and management governance of such risks. Disclosures will be made prospectively, with phased-in effective dates starting with fiscal years beginning on or after January 1, 2025, subject to any regulatory or judicial delays. Other governing bodies have passed or are considering passing related legislature requiring certain environmental, social and governance disclosures. The Company is currently assessing the impact of these changes to its consolidated financial statements.
Current wording
On March 6, 2024, the SEC adopted final rules to enhance disclosures pertaining to climate related risks and associated board and management governance of such risks. On April 4, 2024, the SEC voluntarily stayed implementation of the rules pending the completion of judicial review of consolidated legal challenges to the rules by the United States Court of Appeals for the Eighth Circuit. If the rules go effective as currently contemplated, disclosures will be made prospectively, with phased-in effective dates starting with fiscal years beginning on or after January 1, 2025, subject to any additional regulatory or judicial delays. Other governing bodies have passed or are considering passing related legislature requiring certain environmental, social and governance disclosures. The Company is currently assessing the impact of these changes to its consolidated financial statements.
Previous wording
The Company is subject to contingencies related to environmental laws and regulations. A future change in circumstances with respect to these specific matters or with respect to sites formerly or currently owned or operated by the Company, off-site disposal locations used by the Company, and property owned by third parties that is near such sites, could result in future costs to the Company and such amounts could be material. Expenditures for compliance with environmental control provisions and regulations during 2023 and the first quarter of 2024 were not material.
Current wording
The Company is subject to contingencies related to environmental laws and regulations. A future change in circumstances with respect to these specific matters or with respect to sites formerly or currently owned or operated by the Company, off-site disposal locations used by the Company, and property owned by third parties that is near such sites, could result in future costs to the Company and such amounts could be material. Expenditures for compliance with environmental control provisions and regulations during 2023 and the first two quarters of 2024 were not material.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Total operating earnings for the six months ended June 30, 2024 were $78.1 million, or 18.9% of sales, compared to $54.5 million, or 16.3% of sales, in the comparable prior year period. Gross margin dollars increased $30.3 million, with gross margin as a percent of sales of 39.4%, a slight decrease from 39.5% in the prior year comparable period. Gross margin stability was the result of increased sales volumes and favorable sales mix offset by inflationary cost increases. SEA expenses were $84.5 million or 20.5% of sales compared to $77.7 million or 23.2% in the comparable prior year period. The year-over-year improvement in SEA expense leverage is the result of effective spending controls and higher sales.
Current report — wording carried from elsewhere
The provision for income taxes as a percentage of earnings before income taxes for the six months ended June 30, 2024 was 23.7% compared to 25.1% for the comparable prior year period. Interim provisions are based on an estimate of the overall annual rate that can vary due to state taxes, the relationship of foreign and domestic earnings, and other credits and allowances.
Current report — wording carried from elsewhere
As a result of the above-mentioned items, net earnings for the six months ended June 30, 2024 were $62.2 million, or $2.11 per diluted share, compared to $41.9 million, or $1.42 per diluted share, for the same period in 2023.