STANDEX INTERNATIONAL CORPDE

Previous wording

It is our objective to grow larger and more profitable business units through a commitment to both organic and inorganic initiatives. We have a particular focus on identifying and investing in businesses, new products and new applications that complement our existing products and will increase our overall scale, global presence and capabilities. We continue to execute on acquisitions where strategically aligned with our businesses and where the opportunity meets our investment metrics. We have divested, and likely will continue to divest, businesses that we feel are not strategic or do not meet our growth and return expectations. We also continue to monitor our ability to participate in any governmental assistance programs available to us in each of our global locations and participate in these programs as available and appropriate.

Current wording

It is our objective to grow larger and more profitable business units through a commitment to both organic and inorganic initiatives. We have a particular focus on identifying and investing in businesses, new products and new applications that complement our existing products and will increase our overall scale, global presence and capabilities. We continue to execute on acquisitions where strategically aligned with our businesses and where the opportunity meets our investment metrics. We have divested, and likely will continue to divest, businesses that we feel are not strategic or do not meet our growth and return expectations.

Previous wording

Net sales decreased in the second quarter of fiscal year 2024 by $9.4 million or 5.0%, when compared to the prior year quarter. Organic sales decreased $14.0 million, or 7.4%, due to transitory headwinds in several of our end markets, primarily from unfavorable project timing in our Engineering Technologies group and lower demand in our Specialty segment, partially offset by strong demand in the Engraving segment. Organic sales included $21.0 million in the period attributed to fast growth markets. Foreign currency also positively impacted sales by $1.1 million, or 0.6%. The acquisition of Minntronix positively impacted sales by $10.7 million, or 5.6%, partially offset by the impact on sales associated with the divestiture of Procon of $7.1 million, or 3.8%.

Current wording

Net sales decreased in the third quarter of fiscal year 2024 by $7.1 million or 3.8%, when compared to the prior year quarter. Organic sales decreased $10.5 million, or 5.7%, due to transitory headwinds in several of our end markets, primarily from lower demand in our Electronics and Scientific segments, partially offset by project timing in our Engineering Technologies group and growth in the Hydraulics business. Organic sales included $25.5 million in the period attributed to fast growth markets. Foreign currency negatively impacted sales by $1.6 million, or 0.8%. The acquisitions of Minntronix and Sanyu positively impacted sales by $10.6 million, or 5.7%, partially offset by the impact on sales associated with the divestiture of Procon of $5.5 million, or 3.0%.

Previous wording

Net sales decreased in the six months ended December 31, 2023 by $5.2 million or 1.4%, when compared to the prior year period. Organic sales decreased $9.5 million, or 2.6%, due to transitory headwinds in several of our end markets, primarily from unfavorable project timing in our Engineering Technologies group and lower demand in our Specialty segment, partially offset by pricing actions and strong demand in the Engraving segment. Organic sales included $40.9 million in the period attributed to fast growth markets. Foreign currency also positively impacted sales by $1.9 million, or 0.5%. The acquisition of Minntronix positively impacted sales by $18.2 million, or 4.9%, offset by the impact on sales associated with the divestiture of Procon of $15.7 million, or 4.2%.

Current wording

Net sales decreased in the nine months ended March 31, 2024 by $12.3 million or 2.2%, when compared to the prior year period. Organic sales decreased $20.1 million, or 3.6%, due to transitory headwinds in several of our end markets, primarily from lower demand in our Electronics, Specialty and Scientific segments and project timing in our Engineering Technologies group, partially offset by strong demand in the Engraving segment and pricing actions in the Engineering Technologies group. Organic sales included $66.4 million in the period attributed to fast growth markets. Foreign currency positively impacted sales by $0.3 million. The acquisitions of Minntronix and Sanyu positively impacted sales by $28.8 million, or 5.2%, offset by the impact on sales associated with the divestiture of Procon of $21.3 million, or 3.8%.

Previous wording

Gross profit in the second quarter of fiscal year 2024 decreased to $71.7 million, or a gross margin of 40.2% as compared to $72.3 million, or a gross margin of 38.5%, in the second quarter of fiscal year 2023. The gross profit margin increase was a result of pricing actions, productivity initiatives and contribution from the Minntronix acquisition, partially offset by the divestiture of the Procon business and organic sales decreases of $14.0 million.

Current wording

Gross profit in the third quarter of fiscal year 2024 decreased to $68.3 million, or a gross margin of 38.5% as compared to $70.9 million, or a gross margin of 38.5%, in the third quarter of fiscal year 2023. Gross profit margin remained flat as productivity initiatives and contribution from the Minntronix acquisition were offset by the organic sales decreases and the impact of the divestiture of the Procon business.

Previous wording

Gross profit in the six months ended December 31, 2023 increased to $144.3 million, or a gross margin of 39.7% as compared to $140.6 million, or a gross margin of 38.2%, in the prior year period. The gross profit margin increase was a result of pricing actions, productivity initiatives and contribution from the Minntronix acquisition, partially offset by the divestiture of the Procon business and organic sales decreases of $9.5 million.

Current wording

Gross profit in the nine months ended March 31, 2024 increased to $212.6 million, or a gross margin of 39.3% as compared to $211.5 million, or a gross margin of 38.3%, in the prior year period. The gross profit margin increase was a result of pricing actions, productivity initiatives and contribution from the Minntronix acquisition, partially offset by the divestiture of the Procon business and organic sales decreases.

Previous wording

Selling, General, and Administrative (“SG&A”) expenses for the second quarter of fiscal year 2024 were $43.3 million, or 24.3% of sales, compared to $43.7 million, or 23.3% of sales, during the prior year quarter. SG&A expenses during the quarter were primarily impacted by a reduction in selling and marketing expenses partially offset by increased research and development spending to drive future product initiatives.

Current wording

Selling, General, and Administrative (“SG&A”) expenses for the third quarter of fiscal year 2024 were $41.8 million, or 23.6% of sales, compared to $43.0 million, or 23.3% of sales, during the prior year quarter. SG&A expenses during the quarter were primarily impacted by a reduction in selling and marketing expenses partially offset by a one-time stock-based compensation charge and increased research and development spending to drive future product initiatives.

Previous wording

Selling, General, and Administrative (“SG&A”) expenses for the six months ended December 31, 2023 were $86.9 million, or 23.9% of sales, compared to $84.8 million, or 23.0% of sales, during the prior year period. SG&A expenses during the period were primarily impacted by increased research and development spending and partially offset by a reduction in selling and marketing expenses.

Current wording

Selling, General, and Administrative (“SG&A”) expenses for the nine months ended March 31, 2024 were $128.6 million, or 23.8% of sales, compared to $127.8 million, or 23.1% of sales, during the prior year period. SG&A expenses during the period were primarily impacted by a one-time stock-based compensation charge in the third quarter of the fiscal year 2024 and increased research and development spending and partially offset by a reduction in selling and marketing expenses.

Previous wording

We incurred restructuring expenses of $1.4 million and $3.3 million in the second quarter of fiscal year 2024 and the six months ended December 31, 2023, respectively, primarily related to productivity improvements, facility rationalization activities, and global headcount reductions within our Engraving, Electronics and Engineering Technologies segments as well as the Corporate headquarters.

Current wording

We incurred restructuring expenses of $4.0 million and $7.3 million in the third quarter of fiscal year 2024 and the nine months ended March 31, 2024, respectively, primarily related to facility closures and global headcount reductions within our Engraving, Electronics and Engineering Technologies segments as well as the Corporate headquarters.

Previous wording

We expect to incur restructuring costs of approximately $3.5 million throughout the remainder of fiscal year 2024, as we continue to focus our efforts to reduce cost and improve productivity across our businesses, particularly through headcount reductions and productivity initiatives.

Current wording

We expect to incur restructuring costs of approximately $0.4 million throughout the remainder of fiscal year 2024, as we continue to focus our efforts to reduce cost and improve productivity across our businesses.

Previous wording

We incurred acquisition related expenses of $1.2 million and $1.7 million in the second quarter of fiscal year 2024 and the six months ended December 31, 2023, respectively. Acquisition related expenses typically consist of due diligence, integration, and valuation expenses incurred in connection with recent or pending acquisitions.

Current wording

We incurred acquisition related expenses of $0.5 million and $2.2 million in the third quarter of fiscal year 2024 and the nine months ended March 31, 2024, respectively. Acquisition related expenses typically consist of due diligence, integration, and valuation expenses incurred in connection with recent or pending acquisitions.

Previous wording

Income from operations for the second quarter of fiscal year 2024 was $25.8 million, compared to $27.8 million during the prior year quarter. The decrease of $2.0 million, or 7.1%, is primarily due to organic sales decreases and increased investment in research and development spending, restructuring and acquisition related costs partially offset by pricing actions, along with cost reduction activities and productivity improvement initiatives.

Current wording

Income from operations for the third quarter of fiscal year 2024 was $21.8 million, compared to $88.5 million during the prior year quarter. The decrease of $66.7 million, or 75.3%, is primarily due to the gain on the divestiture of Procon in the third quarter of fiscal year 2023, organic sales decreases and increased investment in research and development spending, restructuring and acquisition related costs. The decreases are partially offset by cost reduction activities and productivity improvement initiatives.

Previous wording

Income from operations for the six months ended December 31, 2023 was $52.7 million, compared to $54.1 million during the prior year period. The decrease of $1.3 million, or 2.5%, is primarily due to organic sales decreases and increased investment in research and development spending, restructuring and acquisition related costs partially offset by pricing actions, along with cost reduction activities and productivity improvement initiatives.

Current wording

Income from operations for the nine months ended March 31, 2024 was $74.6 million, compared to $142.6 million during the prior year period. The decrease of $68.0 million, or 47.7%, is primarily due to the gain on the divestiture of Procon in the third quarter of the fiscal year 2023, organic sales decreases and increased investment in research and development spending, restructuring and acquisition related costs. The decreases are partially offset by cost reduction activities and productivity improvement initiatives.

Previous wording

Interest expense for the second quarter of fiscal year 2024 was $1.0 million, a 34.9% decrease from interest expense of $1.6 million during the prior year quarter. Interest expense for the six months ended December 31, 2023 was $2.3 million, a 16.6% decrease from interest expense of $2.8 million during the prior year period. Our effective interest rate for the six months ended December 31, 2023 was 2.65%.

Current wording

Interest expense for the third quarter of fiscal year 2024 was $0.9 million, a 32.9% decrease from interest expense of $1.4 million during the prior year quarter. Interest expense for the nine months ended March 31, 2024 was $3.2 million, a 22.2% decrease from interest expense of $4.2 million during the prior year period. Our effective interest rate for the nine months ended March 31, 2024 was 2.45%.

Previous wording

Our effective tax rate from continuing operations for the second quarter of fiscal year 2024 and for the six months ended December 31, 2023 was 22.1% and 23.0%, respectively, compared with 23.7% and 23.8% for the prior year quarter and prior year period, respectively. The tax rate was impacted in the current period by the following items: (i) a discrete tax benefit related to equity compensation, (ii) the jurisdictional mix of earnings, (iii) foreign withholding taxes, and (iv) federal research and development tax credits. The tax rate was impacted in the prior period by the following items: (i) a discrete tax benefit related to equity compensation, (ii) the jurisdictional mix of earnings and (iii) foreign withholding taxes.

Current wording

The Company's effective tax rate from continuing operations for the third quarter of fiscal year 2024 and for the nine months ended March 31, 2024 was 21.4% and 22.5%, respectively compared with 6.7% and 13.0% for the prior year quarter and prior year period, respectively. The tax rate was impacted in the current period by the following items: (i) a discrete tax expense related to a provision to return adjustments associated with federal research and development tax credits and the limitation on executive compensation, (ii) the jurisdictional mix of earnings and (iii) a discrete tax benefit related to foreign withholding taxes. The tax rate was impacted in the prior period by the following items: (i) a discrete tax benefit related to the partial release of a valuation allowance previously recorded against deferred tax assets and connected to capital loss carryforwards, resulting from the utilization of capital loss carryforward to offset capital gain from the sale of Procon (ii) a discrete tax expense related to provision to return adjustments as a result of a change in tax rate for the Company’s operations within China's tax jurisdiction, (iii) a discrete tax benefit related to provision to return adjustments associated with federal and state research and development tax credits, (iv) the jurisdictional mix of earnings and (v) foreign withholding taxes.

Previous wording

On July 31, 2023, we completed our acquisition of Minntronix, Inc. (“Minntronix”). We accounted for the Minntronix purchase under the acquisition method in accordance with ASC Topic 805, Business Combinations. Accordingly, the purchase price was allocated to the fair value of the assets acquired, including identifiable intangible assets, and the liabilities assumed as of the closing date. Goodwill resulting from the difference between the fair value of the assets acquired and the fair value of the liabilities assumed is not amortizable for book or tax purposes. Although the acquisition was nontaxable, the transaction gave rise to certain temporary differences for which deferred taxes have been recognized. The results of operations for the Minntronix acquisition have been included in our consolidated financial results beginning on the July 31, 2023 closing date.

Current wording

On July 31, 2023, we completed our acquisition of Minntronix, Inc. (“Minntronix”). We accounted for the Minntronix purchase under the acquisition method in accordance with ASC Topic 805, Business Combinations. Accordingly, the preliminary purchase price was allocated to the fair value of the assets acquired, including identifiable intangible assets, and the liabilities assumed as of the closing date. Goodwill resulting from the difference between the fair value of the assets acquired and the fair value of the liabilities assumed is not amortizable for book or tax purposes. Although the acquisition was nontaxable, the transaction gave rise to certain temporary differences for which deferred taxes have been recognized. The results of operations for the Minntronix acquisition have been included in our consolidated financial results beginning on the closing date.

Previous wording

Total backlog realizable under one year decreased $59.3 million, or 22.1%, to $209.3 million at December 31, 2023, from $268.6 million at December 31, 2022.

Current wording

Total backlog realizable under one year decreased $65.4 million, or 24.7%, to $199.2 million at March 31, 2024, from $264.5 million at March 31, 2023.

Previous wording

Looking forward to the remainder of fiscal year 2024, we expect to be well positioned to build on fiscal year 2023 and thesix months ended December 31, 2023 momentum, with anticipated continued improvement in key financial metrics, supported by productivity initiatives.

Current wording

Looking forward to the remainder of fiscal year 2024, we anticipate continued improvement in key financials metrics, supported by productivity initiatives.

Previous wording

Net sales in the second quarter of fiscal year 2024 increased $6.9 million, or 9.5%, when compared to the prior year quarter. The acquisition of Minntronix in the first quarter of fiscal year 2024 added $10.7 million, or 14.7%, in sales for the second quarter of fiscal year 2024. The organic sales decrease of $4.2 million, or 5.7%, was partially offset by foreign currency impacts of $0.4 million, or 0.5% compared to the prior year quarter. Organic sales were impacted by continued softness in China and Europe, primarily in the appliances and general industrial end markets.

Current wording

Net sales in the third quarter of fiscal year 2024 increased $2.2 million, or 2.8%, when compared to the prior year quarter. The acquisition of Minntronix in the first quarter of fiscal year 2024 added $8.6 million, or 11.0%, in sales for the third quarter of fiscal year 2024. The acquisition of Sanyu in the third quarter of fiscal year 2024 added $2.0 million, or 2.5% in sales for the third quarter of fiscal year 2024. The organic sales decrease of $7.3 million, or 9.3%, and foreign currency impacts of $1.0 million, or 1.3% also negatively affected net sales compared to the prior year quarter. Organic sales were impacted by continued softness in China and Europe, primarily in the appliances and general industrial end markets.

Previous wording

Income from operations in the second quarter of fiscal year 2024 decreased by $1.1 million, or 6.6%, when compared to the prior year quarter. The operating income decrease was the result of lower organic sales and a change in product mix, partially offset by contribution from the Minntronix acquisition, pricing actions and productivity initiatives.

Current wording

Income from operations in the third quarter of fiscal year 2024 decreased by $1.3 million, or 7.9%, when compared to the prior year quarter. The operating income decrease was the result of lower organic sales and a change in product mix, partially offset by contribution from the recent acquisitions and productivity initiatives.

Previous wording

Net sales in the six months ended December 31, 2023 increased $13.4 million, or 9.0%, when compared to the prior year period. The acquisition of Minntronix in the first quarter of fiscal year 2024 added $18.2 million, or 12.3%, in sales for the six months ended December 31, 2023. The organic sales decrease of $5.5 million, or 3.7%, was partially offset by foreign currency impacts of $0.6 million, or 0.4% compared to the prior year period. Organic sales were impacted by continued softness in China and Europe, primarily in appliances and general industrial end markets.

Current wording

Net sales in the nine months ended March 31, 2024 increased $15.6 million, or 6.9%, when compared to the prior year period. The acquisitions of Minntronix and Sanyu in the fiscal year 2024 added $28.8 million, or 12.7%, in sales for the nine months ended March 31, 2024. The organic sales decrease of $12.8 million, or 5.7%, and foreign currency impacts of $0.4 million, or 0.2% also negatively affected net sales compared to the prior year period. Organic sales were impacted by continued softness in China and Europe, primarily in appliances and general industrial end markets.

Previous wording

Income from operations in the six months ended December 31, 2023 decreased by $2.9 million, or 8.3%, when compared to the prior year period. The operating income decrease was the result of lower sales, a change in product mix and foreign currency impacts, partially offset by contribution from the Minntronix acquisition, pricing actions and productivity initiatives.

Current wording

Income from operations in the nine months ended March 31, 2024 decreased by $4.3 million, or 8.2%, when compared to the prior year period. The operating income decrease was the result of lower sales, a change in product mix and foreign currency impacts, partially offset by contributions from the recent acquisitions and productivity initiatives.

Previous wording

Income from operations in the second quarter of fiscal year 2024 increased by $2.5 million, or 39.8%, when compared to the prior year quarter. The operating income increase was driven by organic sales increases and previously announced productivity initiatives.

Current wording

Income from operations in the third quarter of fiscal year 2024 increased by $0.9 million, or 16.9%, when compared to the prior year quarter. The operating income increase was driven by organic sales increases and previously announced productivity initiatives.

Previous wording

Net sales in the six months ended December 31, 2023 increased by $8.9 million, or 12.3%, when compared to the prior year period. Organic sales increased by $7.9 million, or 10.9%, due to strong demand in Europe and growth in soft trim applications in Asia. Foreign currency positive impacts contributed $1.0 million, or 1.3%.

Current wording

Net sales in the nine months ended March 31, 2024 increased by $8.3 million, or 7.6%, when compared to the prior year period. Organic sales increased by $7.9 million, or 7.2%, due to strong demand in Europe and growth in soft trim applications in Asia, partially offset by fewer platform rollouts in North America. Foreign currency positive impacts contributed $0.4 million, or 0.4%.

Previous wording

Income from operations in the six months ended December 31, 2023 increased by $4.3 million, or 35.0%, when compared to the prior year period. The operating income increase was driven by organic sales increases and ongoing productivity initiatives.

Current wording

Income from operations in the nine months ended March 31, 2024 increased by $5.2 million, or 29.5%, when compared to the prior year period. The operating income increase was driven by organic sales increases and ongoing productivity initiatives.

Previous wording

Income from operations in the second quarter of fiscal year 2024 increased $0.1 million, or 2.0%, when compared to the prior year quarter. The small increase is driven by lower oceanic freight costs and productivity initiatives offset by lower volume.

Current wording

Income from operations in the third quarter of fiscal year 2024 increased $0.3 million, or 7.3%, when compared to the prior year quarter. The increase is driven by lower freight costs and productivity initiatives offset by lower volume.

Previous wording

Income from operations in the six months ended December 31, 2023 increased $1.3 million, or 16.4%, when compared to the prior year period. The increase is primarily driven by pricing initiatives and lower oceanic freight costs, partially offset by lower volume.

Current wording

Income from operations in the nine months ended March 31, 2024 increased $1.6 million, or 13.1%, when compared to the prior year period. The increase is primarily driven by productivity initiatives and lower freight costs, partially offset by lower volume.

Previous wording

In the third quarter of fiscal year 2024, on a sequential basis, we expect slightly higher revenue and similar to slightly higher operating margin.

Current wording

In the fourth quarter of fiscal year 2024, on a sequential basis, we expect slightly higher revenue and similar operating margin.

Previous wording

Net sales in the six months ended December 31, 2023 decreased by $4.3 million, or 7.5%, when compared to the prior year period. Organic sales decreased by $3.4 million, or 8.1%, partially offset by foreign currency impacts were $0.3 million, or 0.6%, as compared to the prior year period. The net sales decrease was due to project timing partially offset by pricing actions, an increase in new product development in the fast growth commercial space market, and higher sales to the oil and gas market.

Current wording

Net sales in the nine months ended March 31, 2024 decreased by $1.0 million, or 1.8%, when compared to the prior year period. Organic sales decreased by $1.3 million, or 2.2%, partially offset by foreign currency impacts of $0.3 million, or 0.4%, as compared to the prior year period. The net sales decrease was due to project timing partially offset by pricing actions, an increase in new product development in the fast growth commercial space market, and higher sales to the aviation and oil and gas markets.

Previous wording

Income from operations in the six months ended December 31, 2023 increased by $0.8 million, or 14.6%, when compared to the prior year period. The increase was due to the impact of pricing and productivity initiatives, mostly offset by research and development expenses related to new product development and new applications, partially offset by sales declines due to project timing.

Current wording

Income from operations in the nine months ended March 31, 2024 increased by $1.9 million, or 25.0%, when compared to the prior year period. The increase was due to the impact of pricing and productivity initiatives, partially offset by research and development and sales declines due to project timing.

Previous wording

Net sales in the second quarter of fiscal year 2024 decreased by $12.1 million, or 35.5%, when compared to the prior year quarter. Organic sales for the group decreased $5.0 million, or 14.6%, as compared to the prior year quarter, reflecting an organic sales decline in the Hydraulics business due to an ongoing industry-wide chassis shortage. The divestiture of Procon in the third quarter of fiscal year 2023 negatively impacted the group by $7.1 million, or 20.9%.

Current wording

Net sales in the third quarter of fiscal year 2024 decreased by $8.7 million, or 27.1%, when compared to the prior year quarter. Organic sales for the group decreased $3.2 million, or 10.0%, as compared to the prior year quarter, reflecting a sales normalization in the Display Merchandising business partially offset by an increase in the Hydraulics business. The divestiture of Procon in the third quarter of fiscal year 2023 negatively impacted the group by $5.5 million, or 17.1%.

Previous wording

Income from operations in the second quarter of fiscal year 2024 decreased $1.8 million or 30.6%, when compared to the prior year quarter, due to the Procon divestiture and lower volume in the Hydraulics business.

Current wording

Income from operations in the third quarter of fiscal year 2024 decreased $2.5 million or 34.7%, when compared to the prior year quarter, due to the Procon divestiture and lower volume in the Display Merchandising business, partially offset by higher volume in the Hydraulics business.

Previous wording

Net sales in the six months ended December 31, 2023 decreased by $21.1 million, or 30.7%, when compared to the prior year period. Organic sales for the group decreased $5.4 million, or 7.8%, as compared to the prior year period, reflecting organic growth in the Display Merchandising business, offset by an organic sales decline in the Hydraulics business due to an ongoing industry-wide chassis shortage. The divestiture of Procon in the third quarter of fiscal year 2023 negatively impacted the group by $15.7 million, or 22.9%.

Current wording

Net sales in the nine months ended March 31, 2024 decreased by $29.9 million, or 29.5%, when compared to the prior year period. Organic sales for the group decreased $8.6 million, or 8.5%, as compared to the prior year period, reflecting organic growth decreases in the Display Merchandising business and the Hydraulics business, due to an ongoing industry-wide chassis shortage. The divestiture of Procon in the third quarter of fiscal year 2023 negatively impacted the group by $21.3 million, or 21.0%.

Previous wording

Income from operations in the six months ended December 31, 2023 decreased $2.2 million or 18.7%, when compared to the prior year period, due to the Procon divestiture and lower volume in the Hydraulics business, partially offset by improved operating performance in the Display Merchandising business.

Current wording

Income from operations in the nine months ended March 31, 2024 decreased $4.7 million or 24.8%, when compared to the prior year period. The decrease is due to the Procon divestiture and lower volume in the Display Merchandising and Hydraulics business, partially offset by improved operating performance in the Display Merchandising business.

Previous wording

In the third quarter of fiscal year 2024, on a sequential basis, we expect slightly to moderately higher revenue and operating margin due to improved demand in the Hydraulics business.

Current wording

In the fourth quarter of fiscal year 2024, on a sequential basis, we expect moderately higher revenue and operating margin due to improved end market demand and leverage on higher sales.

Previous wording

Corporate expenses in the second quarter of fiscal year 2024 decreased by 4.4% when compared to the prior year quarter. Corporate expenses in the six months ended December 31, 2023 decreased by 2.5% when compared to the prior year period. We expect corporate expenses to increase in the third quarter of fiscal year 2024 reflecting the impact of a charge due to the CEO reaching retirement eligibility under the stock compensation plan.

Current wording

Corporate expenses in the third quarter of fiscal year 2024 remained flat when compared to the prior year quarter. Corporate expenses in the nine months ended March 31, 2024 decreased by 1.7% when compared to the prior year period. Corporate expenses in fiscal year 2024 reflect the impact of a charge due to the CEO reaching retirement eligibility under the stock compensation plan largely offset by reductions in professional service fees and incentive compensation. We recorded a charge of $0.1 million in other operating income (expense), net for settlement of an environmental remediation claim in the third quarter of fiscal year 2024. In fiscal year 2023, we received a refund from our insurance provider as a recoupment related to a previously recorded litigation matter and incurred a $0.3 million charge related to environmental remediation.

Previous wording

In pursuing our business strategy, the Company may divest certain businesses. Future divestitures may be classified as discontinued operations based on their strategic significance to the Company. Net loss from discontinued operations was $0.2 million and $0.3 million for the three and six months ended December 31, 2023, respectively.

Current wording

In pursuing our business strategy, the Company may divest certain businesses. Future divestitures may be classified as discontinued operations based on their strategic significance to the Company. Net loss from discontinued operations was $0.1 million and $0.4 million for the three and nine months ended March 31, 2024, respectively. Net loss from discontinued operations was less than $0.1 million and $0.1 million for the three and nine months ended March 31, 2023, respectively.

Previous wording

At December 31, 2023, our total cash balance was $142.4 million, of which $116.7 million was held by foreign subsidiaries. The amount and timing of cash repatriation is dependent upon foreign exchange rates and each business unit’s operational needs including requirements to fund working capital, capital expenditure, and jurisdictional tax payments. The repatriation of cash balances from certain of our subsidiaries could have adverse tax consequences or be subject to capital controls; however, those balances are generally available without legal restrictions to fund ordinary business operations.

Current wording

At March 31, 2024, our total cash balance was $138.8 million, of which $110.5 million was held by foreign subsidiaries. The amount and timing of cash repatriation is dependent upon foreign exchange rates and each business unit’s operational needs including requirements to fund working capital, capital expenditure, and jurisdictional tax payments. The repatriation of cash balances from certain of our subsidiaries could have adverse tax consequences or be subject to capital controls; however, those balances are generally available without legal restrictions to fund ordinary business operations.

Previous wording

Net cash provided by continuing operating activities for the six months ended December 31, 2023, was $40.2 million compared to net cash provided by continuing operating activities of $27.1 million in the prior year. We generated $56.8 million from income statement activities and used $15.1 million of cash to fund working capital and other balance sheet increases. Cash flow used in investing activities for the six months ended December 31, 2023 totaled $37.5 million and primarily consisted of $29.2 million for the acquisition of Minntronix in the first quarter of fiscal year 2024 and $8.6 million used for capital expenditures offset by $0.3 million proceeds from the prior divestiture of the Procon business. Cash used for financing activities for the six months ended December 31, 2023 totaled $57.3 million and consisted primarily of repayments of debt of $25.0 million, purchases of stock of $26.7 million and cash paid for dividends of $6.8 million.

Current wording

Net cash provided by continuing operating activities for the nine months ended March 31, 2024, was $64.6 million compared to net cash provided by continuing operating activities of $50.4 million in the prior year. We generated $84.2 million from income statement activities and used $11.1 million of cash to fund working capital and other balance sheet increases. Cash flow used in investing activities for the nine months ended March 31, 2024 totaled $54.0 million and primarily consisted of $29.2 million for the acquisition of Minntronix in the first quarter of fiscal year 2024, $18.5 million for the acquisition of Sanyu in the third quarter of fiscal year 2024, and $13.8 million used for capital expenditures offset by $7.8 million proceeds from the prior divestiture of the Procon business. Cash used for financing activities for the nine months ended March 31, 2024 totaled $65.8 million and consisted primarily purchases of stock of $31.8 million, repayments of debt of $25.0 million and cash paid for dividends of $10.4 million.

Previous wording

Funds borrowed under the facility may be used for the repayment of debt, working capital, capital expenditures, acquisitions (so long as certain conditions, including a specified funded debt to EBITDA leverage ratio is maintained), and other general corporate purposes. As of December 31, 2023, the Company used $2.9 million against the letter of credit sub-facility and had the ability to borrow $347.1 million under the facility based on our current trailing twelve-month EBITDA. The facility contains customary representations, warranties and restrictive covenants, as well as specific financial covenants. The Company’s current financial covenants under the facility are as follows:

Current wording

Funds borrowed under the facility may be used for the repayment of debt, working capital, capital expenditures, acquisitions (so long as certain conditions, including a specified funded debt to EBITDA leverage ratio is maintained), and other general corporate purposes. As of March 31, 2024, the Company used $2.7 million against the letter of credit sub-facility and had the ability to borrow $347.3 million under the facility based on our current trailing twelve-month EBITDA. The facility contains customary representations, warranties and restrictive covenants, as well as specific financial covenants. The Company’s current financial covenants under the facility are as follows:

Previous wording

Interest Coverage Ratio - The Company is required to maintain a ratio of Earnings Before Interest and Taxes, as Adjusted (“Adjusted EBIT per the Credit Facility”), to interest expense for the trailing twelve months of at least 2.75:1. Adjusted EBIT per the Credit Facility specifically excludes extraordinary and certain other defined items such as cash restructuring and acquisition related charges up to the lower of $20.0 million or 10% of EBITDA. The facility also allows for unlimited non-cash purchase accounting and goodwill adjustments. At December 31, 2023, the Company’s Interest Coverage Ratio was 23.30:1.

Current wording

Interest Coverage RatioThe Company is required to maintain a ratio of Earnings Before Interest and Taxes, as Adjusted (“Adjusted EBIT per the Credit Facility”), to interest expense for the trailing twelve months of at least 2.75:1. Adjusted EBIT per the Credit Facility specifically excludes extraordinary and certain other defined items such as cash restructuring and acquisition related charges up to the lower of $20.0 million or 10% of EBITDA. The facility also allows for unlimited non-cash purchase accounting and goodwill adjustments. At March 31, 2024, the Company’s Interest Coverage Ratio was 26.12:1.