CECO ENVIRONMENTAL CORP
For the period ended Sep 30, 2024. Filed Oct 29, 2024.
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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.
Sep 30, 2024 · Filed Oct 29, 2024
CECO$43.71+16.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-07-30.
0000950170-24-087850
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-10-29.
0000950170-24-117928
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 94 previous paragraphs and 96 current paragraphs.
51 unchanged; 35 reworded; 10 added; 8 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 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 (10)
Current report
Orders booked increased $16.8 million, or 11.5%, to $162.3 million during the three months ended September 30, 2024 compared with $145.5 million in the three months ended September 30, 2023. The increase is broad-based with year-over-year growth in both the Engineered Systems and Industrial Process Solutions segments. Notable technologies attributing to the broad-based increase include emissions management and industrial ducting. Of the $162.3 million in orders booked during the three months ended September 30, 2024, $4.6 million is attributable to acquisitions that occurred during the preceding twelve month period.
Current report
Orders booked decreased $6.1 million, or 1%, to $448.3 million during the nine months ended September 30, 2024 compared with $454.4 million in the nine months ended September 30, 2023. The decrease is primarily related to two unique industrial air bookings from the first half of 2023 that were not expected to repeat. Of the $448.3 million in orders booked during the nine months ended September 30, 2024, $25.6 million is attributable to acquisitions that occurred during the preceding twelve month period.
Current report
Our Engineered Systems segment orders booked increased $13.2 million, or 12.1%, to $122.1 million during the three months ended September 30, 2024 compared with $108.9 million in the three months ended September 30, 2023. The increase is primarily driven by power end market bookings at emissions management, partially offset by a decrease in bookings at acoustics technologies. Of the $122.1 million in orders booked during the three months ended September 30, 2024, $4.0 million is attributable to an acquisition that occurred during the preceding twelve month period.
Current report
Our Engineered Systems segment orders booked were $322.8 million during the nine months ended September 30, 2024 compared with $309.4 million in the nine months ended September 30, 2023. The increase is primarily attributable to growth in water and wastewater treatment technologies. Of the $322.8 million in orders booked during the nine months ended September 30, 2024, $22.0 million is attributable to acquisitions that occurred during the preceding twelve month period.
Current report
Our Engineered Systems segment net sales decreased $14.2 million to $91.3 million for the three months ended September 30, 2024 compared with $105.5 million for the three months ended September 30, 2023. The decrease is entirely attributable to the variability in timing of large order bookings. On a trailing twelve-month basis, Engineered Systems revenue has increased $49.8 million, or
Current report
14.6%. Approximately 94%, or $85.8 million, of net sales for the three months ended September 30, 2024 is attributable to organic revenue.
Current report
Our Industrial Process Solutions segment orders booked increased $3.6 million, or 9.8%, to $40.1 million during the three months ended September 30, 2024 compared with $36.5 million in the three months ended September 30, 2023. The increase is wholly driven by an increase in our industrial ducting business. Of the $40.1 million in orders booked during the three months ended September 30, 2024, $0.6 million is attributable to an acquisition that occurred during the preceding twelve month period.
Current report
Our Industrial Process Solutions segment orders booked decreased $19.4 million, or 13.4%, to $125.6 million during the nine months ended September 30, 2024 compared with $145.0 million in the nine months ended September 30, 2023. The decrease is primarily related to two unique industrial air bookings from the first half of 2023 that were not expected to repeat. Of the $125.6 million in orders booked during the nine months ended September 30, 2024, $0.6 million is attributable to an acquisition that occurred during the preceding twelve month period.
Current report
our ability to optimize our business portfolio by identifying acquisition targets, executing upon any strategic acquisitions or divestitures, integrating acquired businesses and realizing the synergies from strategic transactions;
Current report
risks regarding the parties’ ability to complete the proposed acquisition of Profire in the anticipated timeframe or at all, the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement between the parties, the effect of the announcement or pendency of the proposed transaction on business relationships, operating results, and business generally, disruption of current plans and operations and potential difficulties in employee retention as a result of the proposed transaction, diversion of management’s attention from ongoing business operations, the outcome of any legal proceedings that may be instituted related to the proposed transaction, the amount of the costs, fees, expenses and other charges related to the proposed transaction, the risk that competing offers or acquisition proposals will be made and the achievement of the anticipated benefits of the acquisition.
Removed paragraphs (8)
Previous report
Orders booked decreased $22.1 million, or 13.6%, to $140.8 million during the three months ended June 30, 2024 compared with $162.9 million in the three months ended June 30, 2023. The decrease is primarily driven by a decrease related to emissions management, offset by an increase related to our separation, filtration and industrial water technologies. Of the $140.8 million in orders booked during the three months ended June 30, 2024, $12.2 million is attributable to acquisitions that occurred during the preceding twelve month period.
Previous report
Orders booked decreased $22.9 million, or 7%, to $286.1 million during the six months ended June 30, 2024 compared with $309.0 million in the six months ended June 30, 2023. The decrease is primarily driven by a decrease related to emissions management, offset by an increase related to our separation, filtration and industrial water technologies. Of the $286.1 million in orders booked during the six months ended June 30, 2024, $21.0 million is attributable to acquisitions that occurred during the preceding twelve month period.
Previous report
Our Engineered Systems segment orders booked decreased $3.4 million, or 3.2%, to $100.6 million during the three months ended June 30, 2024 compared with $103.9 million in the three months ended June 30, 2023. The decrease is primarily driven by a decrease related to emissions management, offset by an increase related to dampers and expansion joints. Of the $100.6 million in orders booked during the three months ended June 30, 2024, $12.2 million is attributable to acquisitions that occurred during the preceding twelve month period.
Previous report
Our Engineered Systems segment orders booked were $200.0 million during the six months ended June 30, 2024 compared with $200.5 million in the six months ended June 30, 2023. Of the $200.0 million in orders booked during the six months ended June 30, 2024, $21.0 million is attributable to acquisitions that occurred during the preceding twelve month period.
Previous report
Our Engineered Systems segment net sales increased $24.7 million to $186.7 million for the six months ended June 30, 2024 compared with $162.0 million for the six months ended June 30, 2023. The increase is led by an increase of $17.8 million related to our separation, filtration, and industrial water technologies. Approximately 92%, or $172.1 million, of net sales for the six months ended June 30, 2024 is attributable to organic revenue.
Previous report
Our Industrial Process Solutions segment orders booked decreased $18.7 million, or 31.8%, to $40.2 million during the three months ended June 30, 2024 compared with $58.9 million in the three months ended June 30, 2023. The decrease is primarily driven by a decrease related to industrial air end markets, offset by an increase related to duct fabrication and installation.
Previous report
Our Industrial Process Solutions segment orders booked decreased $23.0 million, or 21.2%, to $85.5 million during the six months ended June 30, 2024 compared with $108.5 million in the six months ended June 30, 2023. The decrease is primarily driven by a decrease related to industrial air end markets, offset by an increase related to duct fabrication and installation.
Previous report
our ability to successfully identify acquisition targets, integrate acquired businesses and realize the synergies from strategic transactions; and
Reworded paragraphs (35)
Previous wording
The Company’s Condensed Consolidated Statements of Income for the three and six months ended June 30, 2024 and 2023 reflect the consolidated operations of the Company and its subsidiaries.
Current wording
The Company’s Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2024 and 2023 reflect the consolidated operations of the Company and its subsidiaries.
Previous wording
Our Condensed Consolidated Statements of Income for the three and six months ended June 30, 2024 and 2023 are as follows:
Current wording
Our Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2024 and 2023 are as follows:
Previous wording
To compare operating performance between the three and six months ended June 30, 2024 and 2023, the Company has adjusted GAAP operating income to exclude (1) amortization of intangible assets, and earnout expenses, (2) acquisition and integration expenses, which include legal, accounting, and other expenses, (3) executive transition expenses, including fees and expenses incurred in the search for and hiring of new executives, (4) restructuring expenses primarily relating to severance, facility exits, and associated legal expenses, and (5) asbestos litigation expenses, related to expected future settlement payments.
Current wording
To compare operating performance between the three and nine months ended September 30, 2024 and 2023, the Company has adjusted GAAP operating income to exclude (1) amortization of intangible assets, and earnout expenses, (2) acquisition and integration expenses, which include legal, accounting, and other expenses, (3) executive transition expenses, including fees and expenses incurred in the search for and hiring of new executives, (4) restructuring expenses primarily relating to severance, facility exits, and associated legal expenses, and (5) asbestos litigation expenses, related to expected future settlement payments.
Previous wording
Net sales for the three months ended June 30, 2024 increased $8.3 million, or 6.4%, to $137.5 million compared with $129.2 million for the three months ended June 30, 2023. The increase is broad-based, led by an increase of $5.2 million related to our separation, filtration and industrial water technologies. Approximately 97%, or $132.8 million, of net sales for the three months ended June 30, 2024 is attributable to organic revenue, defined as revenue recorded subsequent to the twelve month period post-acquisition date.
Current wording
Net sales for the three months ended September 30, 2024 decreased $13.9 million, or 9.3%, to $135.5 million compared with $149.4 million for the three months ended September 30, 2023. The decrease is entirely attributable to the Engineered Systems segment, notably driven by variability in timing of large order bookings. On a trailing twelve-month basis, Engineered Systems revenue has increased $49.8 million, or 14.6%. Approximately 94%, or $127.6 million, of net sales for the three months ended September 30, 2024 is attributable to organic revenue, defined as revenue recorded subsequent to the twelve month period post-acquisition date.
Previous wording
Net sales for the six months ended June 30, 2024 increased $22.2 million, or 9.2%, to $263.9 million compared with $241.7 million for the six months ended June 30, 2023. The increase is broad-based, led by an increase of $17.8 million related to separation, filtration, and industrial water technologies. Approximately 94% or $249.2 million, of net sales for the six months ended June 30, 2024 is attributable to organic revenue.
Current wording
Net sales for the nine months ended September 30, 2024 increased $8.3 million, or 2.1%, to $399.4 million compared with $391.1 million for the nine months ended September 30, 2023. The increase is broad-based, led by an increase of $10.5 million across multiple technologies within the Engineered Systems segment. Approximately 94% or $376.8 million, of net sales for the nine months ended September 30, 2024 is attributable to organic revenue.
Previous wording
Gross profit increased $9.2 million, or 23.1%, to $49.0 million in the three months ended June 30, 2024 compared with $39.8 million in the three months ended June 30, 2023. The increase in gross profit is primarily attributable to sales mix, project execution and flow through from higher booked margins, as well as continued benefits from sourcing and value engineering. Gross profit as a percentage of sales increased to 35.6% in the three months ended June 30, 2024 compared with 30.8% in the three months ended June 30, 2023.
Current wording
Gross profit increased $2.2 million, or 5.1%, to $45.3 million in the three months ended September 30, 2024 compared with $43.1 million in the three months ended September 30, 2023. The increase in gross profit is primarily attributable to sales mix, project execution and flow through from higher booked margins, as well as continued benefits from sourcing and value engineering. Gross profit as a percentage of sales increased to 33.4% in the three months ended September 30, 2024 compared with 28.8% in the three months ended September 30, 2023.
Previous wording
Gross profit increased $19.5 million, or 26.1%, to $94.2 million in the six months ended June 30, 2024 compared with $74.7 million in the six months ended June 30, 2023. The increase in gross profit is primarily attributable to sales mix, project execution and flow through from higher booked margins, as well as continued benefits from sourcing and value engineering. Gross profit as a percentage of sales increased to 35.7% in the six months ended June 30, 2024 compared with 30.9% in the six months ended June 30, 2023.
Current wording
Gross profit increased $21.7 million, or 18.4%, to $139.5 million in the nine months ended September 30, 2024 compared with $117.8 million in the nine months ended September 30, 2023. The increase in gross profit is primarily attributable to sales mix, project execution and flow through from higher booked margins, as well as continued benefits from sourcing and value engineering. Gross profit as a percentage of sales increased to 34.9% in the nine months ended September 30, 2024 compared with 30.1% in the nine months ended September 30, 2023.
Previous wording
Selling and administrative expenses were $36.4 million for the three months ended June 30, 2024 compared with $28.4 million for the three months ended June 30, 2023. The increase is primarily attributable to acquisitions during the prior year, workforce merit and other annual compensation adjustments, and investments in functional support for sourcing and manufacturing benefits.
Current wording
Selling and administrative expenses were $34.3 million for the three months ended September 30, 2024 compared with $30.3 million for the three months ended September 30, 2023. The increase is primarily attributable to workforce merit and other annual compensation adjustments, and investments in functional support for sourcing and manufacturing benefits.
Previous wording
Selling and administrative expenses were $71.4 million for the six months ended June 30, 2024 compared with $55.6 million for the six months ended June 30, 2023. The increase is primarily attributable to acquisitions during the prior year, workforce merit and other annual compensation adjustments, and investments in functional support for sourcing and manufacturing benefits.
Current wording
Selling and administrative expenses were $105.7 million for the nine months ended September 30, 2024 compared with $86.1 million for the nine months ended September 30, 2023. The increase is primarily attributable to workforce merit and other annual compensation adjustments, and investments in functional support for sourcing and manufacturing benefits.
Previous wording
Amortization and earnout expense was $2.2 million for the three months ended June 30, 2024, compared with $2.3 million for the three months ended June 30, 2023.
Current wording
Amortization and earnout expense was $2.6 million for the three months ended September 30, 2024, compared with $2.0 million for the three months ended September 30, 2023.
Previous wording
Amortization and earnout expense was $4.4 million for the six months ended June 30, 2024 compared with $4.0 million for the six months ended June 30, 2023. The increase in expense is attributable to an increase of $0.7 million in earnout expense and an increase of $0.4 million in definite lived asset amortization due to increased intangible assets attributable to prior year acquisitions.
Current wording
Amortization and earnout expense was $7.1 million for the nine months ended September 30, 2024 compared with $6.0 million for the nine months ended September 30, 2023. The increase in expense is attributable to an increase of $0.4 million in earnout expense and increases in definite lived asset amortization due to increased intangible assets attributable to current and prior year acquisitions.
Previous wording
Operating income increased $2.8 million to $16.9 million for the six months ended June 30, 2024 compared with operating income of $14.1 million for the six months ended June 30, 2023. The increase in operating income is primarily attributable to the increase in net sales.
Current wording
Operating income decreased $0.7 million to $7.2 million for the three months ended September 30, 2024 compared with operating income of $7.9 million for the three months ended September 30, 2023. The decrease in operating income is primarily attributable to the increase in selling and administrative expenses, partially offset by the increased gross profit.
Previous wording
Operating income increased $0.7 million to $9.3 million for the three months ended June 30, 2024 compared with operating income of $8.6 million for the three months ended June 30, 2023. The increase in operating income is primarily attributable to the increase in net sales.
Current wording
Operating income increased $2.2 million to $24.1 million for the nine months ended September 30, 2024 compared with operating income of $21.9 million for the nine months ended September 30, 2023. The increase in operating income is primarily attributable to the increase in net sales.
Previous wording
Non-GAAP operating income was $12.6 million for the three months ended June 30, 2024 compared with $11.4 million for the three months ended June 30, 2023. Non-GAAP operating income as a percentage of sales increased to 9.2% for the three months ended June 30, 2024 from 8.8% for the three months ended June 30, 2023.
Current wording
Non-GAAP operating income was $11.0 million for the three months ended September 30, 2024 compared with $12.8 million for the three months ended September 30, 2023. Non-GAAP operating income as a percentage of sales decreased to 8.1% for the three months ended September 30, 2024 from 8.6% for the three months ended September 30, 2023.
Previous wording
Non-GAAP operating income was $22.8 million for the six months ended June 30, 2024 compared with $19.1 million for the six months ended June 30, 2023. Non-GAAP operating income as a percentage of sales increased to 8.6% for the three months ended June 30, 2024 from 7.9% for the six months ended June 30, 2023.
Current wording
Non-GAAP operating income was $33.8 million for the nine months ended September 30, 2024 compared with $31.7 million for the nine months ended September 30, 2023. Non-GAAP operating income as a percentage of sales increased to 8.5% for the three months ended September 30, 2024 from 8.1% for the nine months ended September 30, 2023.
Previous wording
Interest expense decreased to $3.3 million in the three months ended June 30, 2024 compared with interest expense of $3.8 million for the three months ended June 30, 2023. The decrease in interest expense is primarily due to reduction of the debt balance.
Current wording
Interest expense decreased to $2.6 million in the three months ended September 30, 2024 compared with interest expense of $3.3 million for the three months ended September 30, 2023. The decrease in interest expense is primarily due to reduction of the debt balance.
Previous wording
Interest expense increased to $6.7 million in the six months ended June 30, 2024 compared with interest expense of $6.2 million for the six months ended June 30, 2023. The increase in interest expense is primarily due to rising interest rates.
Current wording
Interest expense decreased to $9.3 million in the nine months ended September 30, 2024 compared with interest expense of $9.5 million for the nine months ended September 30, 2023. The decrease in interest expense is primarily due to reduction of the debt balance.
Previous wording
Income tax expense was $0.4 million for the three months ended June 30, 2024 compared with income tax expense of $1.0 million for the three months ended June 30, 2023. Income tax expense was $1.1 million for the six months ended June 30, 2024 compared with income tax expense of $1.0 million for the six months ended June 30, 2023. The effective income tax rate for the three months ended June 30, 2024 was 7.4% compared with 19.8% for the three months ended June 30, 2023. The effective income tax rate for the six months ended June 30, 2024 was 13.1% compared with 13.3% for the six months ended June 30, 2023. The effective income tax rates for the three and six months ended June 30, 2024 differ from the United States federal statutory rate. Our effective tax rate is affected by certain other permanent differences, including state income taxes, non-deductible incentive stock-based compensation, and differences in tax rates among the jurisdictions in which we operate. Additionally, we received a tax indemnification payment of $0.5 million, related to a prior year acquisition, in the second quarter of 2024.
Current wording
Income tax expense was $1.6 million for the three months ended September 30, 2024 compared with income tax expense of $0.6 million for the three months ended September 30, 2023. Income tax expense was $2.7 million for the nine months ended September 30, 2024 compared with income tax expense of $1.6 million for the nine months ended September 30, 2023. The effective income tax rate for the three months ended September 30, 2024 was 38.7% compared with 13.6% for the three months ended September 30, 2023. The effective income tax rate for the nine months ended September 30, 2024 was 21.8% compared with 13.4% for the nine months ended September 30, 2023. The effective income tax rates for the three and nine months ended September 30, 2024 differ from the United States federal statutory rate. Our effective tax rate is affected by certain other permanent differences, including state income taxes, non-deductible incentive stock-based compensation, and differences in tax rates among the jurisdictions in which we operate. Additionally, we received a tax indemnification payment of $0.5 million, related to a prior year acquisition, in the second quarter of 2024.
Previous wording
Our Engineered Systems segment net sales increased $9.9 million to $97.4 million for the three months ended June 30, 2024 compared with $87.5 million for the three months ended June 30, 2023. The increase is led by an increase of $5.2 million related to our separation, filtration, and industrial water technologies. Approximately 95%, or $92.7 million, of net sales for the three months ended June 30, 2024 is attributable to organic revenue.
Current wording
Our Engineered Systems segment net sales increased $10.5 million to $278.0 million for the nine months ended September 30, 2024 compared with $267.5 million for the nine months ended September 30, 2023. The increase is led by growth in our separation, filtration, and industrial water technologies, partially offset by power end market revenue. Approximately 93%, or $257.9 million, of net sales for the nine months ended September 30, 2024 is attributable to organic revenue.
Previous wording
Operating income for the Engineered Systems segment increased $11.7 million to $35.6 million for the six months ended June 30, 2024 compared with $23.9 million for the six months ended June 30, 2023. The increase is primarily attributable to increased net sales, partially offset by an increase in direct costs.
Current wording
Operating income for the Engineered Systems segment is flat at $15.8 million for the three months ended September 30, 2024 compared with $15.8 million for the three months ended September 30, 2023. The increase is primarily attributable to increased net sales, partially offset by an increase in direct costs.
Previous wording
Operating income for the Engineered Systems segment increased $5.2 million to $19.3 million for the three months ended June 30, 2024 compared with $14.1 million for the three months ended June 30, 2023. The increase is primarily attributable to increased net sales, partially offset by an increase in direct costs.
Current wording
Operating income for the Engineered Systems segment increased $11.8 million to $51.4 million for the nine months ended September 30, 2024 compared with $39.6 million for the nine months ended September 30, 2023. The increase is primarily attributable to increased net sales, partially offset by an increase in direct costs.
Previous wording
Our Industrial Process Solutions segment net sales were $40.1 million for the three months ended June 30, 2024 compared with $41.7 million for the three months ended June 30, 2023. All sales for the three months ended June 30, 2024 represent organic revenue.
Current wording
Our Industrial Process Solutions segment net sales were $44.2 million for the three months ended September 30, 2024 compared with $43.9 million for the three months ended September 30, 2023. Approximately 95%, or $41.8 million, of net sales for the three months ended September 30, 2024 is attributable to organic revenue.
Previous wording
Our Industrial Process Solutions segment net sales were $77.1 million for the six months ended June 30, 2024 compared with $79.8 million for the six months ended June 30, 2023. All sales for the six months ended June 30, 2024 represent organic revenue.
Current wording
Our Industrial Process Solutions segment net sales were $121.3 million for the nine months ended September 30, 2024 compared with $123.6 million for the nine months ended September 30, 2023. Approximately 98%, or $118.9 million, of net sales for the nine months ended September 30, 2024 is attributable to organic revenue.
Previous wording
Operating income for the Industrial Process Solutions segment increased $1.1 million to $5.7 million for the three months ended June 30, 2024 compared with $4.6 million for the three months ended June 30, 2023. The increase is primarily attributable to a decrease in direct costs, partially offset by a decrease in net sales.
Current wording
Operating income for the Industrial Process Solutions segment increased $2.5 million to $8.1 million for the three months ended September 30, 2024 compared with $5.6 million for the three months ended September 30, 2023. The increase is primarily attributable to a decrease in direct costs, partially offset by a decrease in net sales.
Previous wording
Operating income for the Industrial Process Solutions segment increased $2.7 million to $12.8 million for the six months ended June 30, 2024 compared with $10.1 million for the six months ended June 30, 2023. The increase is primarily attributable to increased sales, partially offset by an increase in direct costs.
Current wording
Operating income for the Industrial Process Solutions segment increased $5.0 million to $20.8 million for the nine months ended September 30, 2024 compared with $15.8 million for the nine months ended September 30, 2023. The increase is primarily attributable to increased sales, partially offset by an increase in direct costs.
Previous wording
Operating expense for the Corporate and Other segment increased $5.6 million to $15.7 million for the three months ended June 30, 2024 compared with $10.1 million for the three months ended June 30, 2023. The increase is primarily attributable to investments made to support growth inclusive of acquisition and integration expenses, and inflationary increases for wages and services.
Current wording
Operating expense for the Corporate and Other segment increased $3.2 million to $16.7 million for the three months ended September 30, 2024 compared with $13.5 million for the three months ended September 30, 2023. The increase is primarily attributable to investments made to support growth inclusive of acquisition and integration expenses, and inflationary increases for wages and services.
Previous wording
Operating expense for the Corporate and Other segment increased $11.4 million to $31.4 million for the six months ended June 30, 2024 compared with $20.0 million for the six months ended June 30, 2023. The increase is primarily attributable to investments made to support growth inclusive of acquisition and integration expenses, and inflationary increases for wages and services.
Current wording
Operating expense for the Corporate and Other segment increased $14.6 million to $48.1 million for the nine months ended September 30, 2024 compared with $33.5 million for the nine months ended September 30, 2023. The increase is primarily attributable to investments made to support growth inclusive of acquisition and integration expenses, and inflationary increases for wages and services.
Previous wording
Backlog (i.e., unfulfilled or remaining performance obligations) represents the sales we expect to recognize for our products and services for which control has not yet transferred to the customer. Backlog increased to $390.9 million as of June 30, 2024 from $370.9 million as of December 31, 2023. Our customers may have the right to cancel a given order. Historically, cancellations have not been common. Backlog is adjusted on a quarterly basis for adjustments in foreign currency exchange rates. Substantially all backlog is expected to be delivered within 12 to 18 months. Backlog is not defined by GAAP and our methodology for calculating backlog may not be consistent with methodologies used by other companies.
Current wording
Backlog (i.e., unfulfilled or remaining performance obligations) represents the sales we expect to recognize for our products and services for which control has not yet transferred to the customer. Backlog increased to $437.5 million as of September 30, 2024 from $370.9 million as of December 31, 2023. Our customers may have the right to cancel a given order. Historically, cancellations have not been common. Backlog is adjusted on a quarterly basis for adjustments in foreign currency exchange rates. Substantially all backlog is expected to be delivered within 12 to 18 months. Backlog is not defined by GAAP and our methodology for calculating backlog may not be consistent with methodologies used by other companies.
Previous wording
At June 30, 2024, the Company had working capital of $74.1 million, compared with $78.3 million at December 31, 2023. The ratio of current assets to current liabilities was 1.36 to 1.00 on June 30, 2024, as compared with a ratio of 1.39 to 1.00 on December 31, 2023. The decrease in the ratio was driven by timing of cash receipts and payments to suppliers.
Current wording
At September 30, 2024, the Company had working capital of $63.1 million, compared with $78.3 million at December 31, 2023. The ratio of current assets to current liabilities was 1.30 to 1.00 on September 30, 2024, as compared with a ratio of 1.39 to 1.00 on December 31, 2023. The decrease in the ratio was driven by timing of cash receipts and payments to suppliers.
Previous wording
At June 30, 2024 and December 31, 2023, cash and cash equivalents totaled $36.5 million and $54.8 million, respectively. As of June 30, 2024 and December 31, 2023, $28.6 million and $38.5 million, respectively, of our cash and cash equivalents were held by certain non-United States subsidiaries, as well as being denominated in foreign currencies.
Current wording
At September 30, 2024 and December 31, 2023, cash and cash equivalents totaled $38.7 million and $54.8 million, respectively. As of September 30, 2024 and December 31, 2023, $25.3 million and $38.5 million, respectively, of our cash and cash equivalents were held by certain non-United States subsidiaries, as well as being denominated in foreign currencies.
Previous wording
For the six months ended June 30, 2024, $7.9 million of cash was provided by operating activities compared with $0.6 million used in operations in the prior year period, representing $8.5 million additional cash generated. Cash flow from operating activities in the first six months of 2024 increased year-over-year primarily due to timing of costs and billings on uncompleted contracts, and improved management of payments to suppliers.
Current wording
For the nine months ended September 30, 2024, $23.0 million of cash was provided by operating activities compared with $29.5 million provided by operations in the prior year period, representing $6.5 million decline in cash generated. Cash flow from operating activities in the first nine months of 2024 decreased year-over-year primarily due to timing of costs and billings on uncompleted contracts and payments of prepaid expenses, partially offset by decreases in accounts receivable.
Previous wording
For the six months ended June 30, 2024, net cash used in investing activities was $6.8 million compared with $28.1 million used in investing activities in the prior year period. For the six months ended June 30, 2024, the $6.8 million cash used in investing activities was primarily the result of acquisitions of property and equipment. In the prior year period, the $28.1 million cash used in investing activities was the result of $24.1 million used for acquisitions as described in Note 15 and $3.9 million for the acquisition of property and equipment.
Current wording
For the nine months ended September 30, 2024, net cash used in investing activities was $26.2 million compared with $53.6 million used in investing activities in the prior year period. For the nine months ended September 30, 2024, the $26.2 million cash used in investing activities was primarily the result of $15.0 million used for acquisitions as described in Note 15 and $11.2 million for acquisitions of property and equipment. In the prior year period, the $53.6 million cash used in investing activities was the result of $48.1 million used for acquisitions as described in Note 15 and $5.5 million for the acquisition of property and equipment.
Previous wording
For the six months ended June 30, 2024, $16.6 million was used in financing activities compared with $29.5 million provided by financing activities in the prior year period, for a decrease of $12.9 million. For the six months ended June 30, 2024, the primary uses of cash for financing activities were $6.7 million to repay long-term debt, $5.0 million to repurchase common stock, $2.1 million of deferred consideration paid for acquisitions, $1.7 million for earnout payments and $1.1 million on distributions to the noncontrolling interest. In the prior year period, the Company used $31.9 million for net borrowings on the Company’s revolving credit lines, primarily used to finance acquisitions, $1.7 million in repayment on long-term debt, $0.9 million on deferred payments for acquisitions, and $0.6 million on distributions to the noncontrolling interest. The Company also received $1.2 million of proceeds from the exercise of stock options and the employee stock purchase plan.
Current wording
For the nine months ended September 30, 2024, $14.5 million was used in financing activities compared with $25.2 million provided by financing activities in the prior year period, for a decrease of $10.7 million. For the nine months ended September 30, 2024, the primary uses of cash for financing activities were $7.8 million to repay long-term debt, $5.0 million to repurchase common stock, $2.1 million of deferred consideration paid for acquisitions, $1.7 million for earnout payments and $1.7 million on distributions to the noncontrolling interest, partially offset by net borrowings on the Company's revolving credit lines of $3.6 million. In the prior year period, the Company used $31.0 million for net borrowings on the Company’s revolving credit lines, primarily used to finance acquisitions, $2.5 million in repayment on long-term debt, $1.2 million on deferred payments for acquisitions, and $1.4 million on distributions to the noncontrolling interest. The Company also received $1.4 million of proceeds from the exercise of stock options and the employee stock purchase plan.
Previous wording
Management believes there have been no changes during the six months ended June 30, 2024 to the items that the Company disclosed as its critical accounting policies and estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Current wording
Management believes there have been no changes during the nine months ended September 30, 2024 to the items that the Company disclosed as its critical accounting policies and estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Previous wording
unpredictability and severity of catastrophic events, including cybersecurity threats, acts of terrorism or outbreak of war or hostilities or public health crises, as well as management’s response to any of the aforementioned factors.
Current wording
unpredictability and severity of catastrophic events, including cybersecurity threats, acts of terrorism or outbreak of war or hostilities or public health crises, as well as management’s response to any of the aforementioned factors; and