PREFORMED LINE PRODUCTS CO

Previous wording

The following discussion describes our results of operations for the three and six months ended June 30, 2024 and 2023. Our consolidated financial statements are prepared in conformity with United States ("U.S.") generally accepted accounting principles ("GAAP"). Our discussions of the financial results include non-GAAP measures (e.g., foreign currency impact) to provide additional information concerning our financial results and provide information that we believe is useful to the readers of our financial statements in the assessment of our performance and operating trends.

Current wording

The following discussion describes our results of operations for the three and nine months ended September 30, 2024 and 2023. Our consolidated financial statements are prepared in conformity with United States ("U.S.") generally accepted accounting principles ("GAAP"). Our discussions of the financial results include non-GAAP measures (e.g., foreign currency impact) to provide additional information concerning our financial results and provide information that we believe is useful to the readers of our financial statements in the assessment of our performance and operating trends.

Previous wording

Net sales of $138.7 million decreased $43.1 million for the three months ended June 30, 2024 year-over-year and net sales of $279.6 million decreased $84.0 million for the six months ended June 30, 2024 year-over-year, mainly due to the elevated inventory levels at PLP-USA communications markets' customers and distributors. The inflationary headwinds we experienced in 2022 and early 2023 related to raw materials, specifically plastic resins, aluminum and sand (grit), have generally subsided. Costs related to shipping and freight have similarly fallen from their 2022 peak. Decreases in these underlying costs along with the impacts of our previous price increases benefited gross margins in 2023 and have not meaningfully impacted the results for the second quarter or six months ended June 30, 2024. If inflationary pressures increase again, it may require further price adjustments to maintain profit margin, and any price increases may have a negative effect on demand.

Current wording

Net sales of $147.0 million decreased $13.5 million for the three months ended September 30, 2024 year-over-year and net sales of $426.6 million decreased $97.5 million for the nine months ended September 30, 2024 year-over-year, mainly due to the continued inventory destocking at PLP-USA communications markets' customers and distributors. The inflationary headwinds we experienced in 2022 and early 2023 related to raw materials, specifically plastic resins, aluminum and sand (grit), have generally subsided. Costs related to shipping and freight have similarly fallen from their 2022 peak. Decreases in these underlying costs along with the impacts of our previous price increases benefited gross margins in 2023 and have not meaningfully impacted the results for the third quarter or nine months ended September 30, 2024. If inflationary pressures increase again, it may require further price adjustments to maintain profit margin, and any price increases may have a negative effect on demand.

Previous wording

Our financial statements are subject to fluctuations in the exchange rates of foreign currencies in relation to the U.S. dollar. The fluctuations of foreign currencies during the three and six months ended June 30, 2024 had a unfavorable impact on net sales of $1.1 million and $0.3 million, respectively. The fluctuations on foreign currencies during the three and six months ended June 30, 2024 had a de minimis impact on net income. The fluctuations of foreign currencies during the three and six months ended June 30, 2023 had an unfavorable impact on net sales of $2.5 million and $7.1 million, respectively. The fluctuations on foreign currencies during the three and six months ended June 30, 2023 had an unfavorable impact on net income of $0.4 million and $0.6 million, respectively. On a reportable segment basis, the impact of foreign currency translation on net sales and net income for the three and six months ended June 30, 2024, was as follows:

Current wording

Our financial statements are subject to fluctuations in the exchange rates of foreign currencies in relation to the U.S. dollar. The fluctuations of foreign currencies during the three and nine months ended September 30, 2024 had a unfavorable impact on net sales of $0.8 million and $1.1 million, respectively. The fluctuations on foreign currencies during the three and nine months ended September 30, 2024 had an unfavorable impact on net income of $0.1 million and $0.2 million, respectively. The fluctuations of foreign currencies during the three and nine months ended September 30, 2023 had a favorable impact on net sales of $1.4 million and unfavorable impact on net sales of $5.6 million, respectively. The fluctuations on foreign currencies during the three and nine months ended September 30, 2023 had an unfavorable impact on net income of $0.1 million and $0.7 million, respectively. On a reportable segment basis, the impact of foreign currency translation on net sales and net income for the three and nine months ended September 30, 2024, was as follows:

Previous wording

Although elevated inventory levels in the PLP-USA communications markets and other market headwinds have impacted our first half 2024 results, we believe our business portfolio and our financial position are sound and strategically well-positioned. We remain focused on assessing our global market opportunities and overall manufacturing capacity in conjunction with the requirements of local manufacturing in the markets that we serve. As necessary, we will modify redundant processes and further utilize our global manufacturing network to manage costs, increase sales volume and deliver value to our customers. Period cost containment has been a priority for the Company in 2024, shown through a reduction in costs and expenses of 13% for the six months ended June 30, 2024. We have continued to invest in the business to expand into new markets for the Company, evaluate strategic mergers and acquisitions, improve efficiency, develop new products and increase our capacity. As of June 30, 2024, our liquidity remains strong with our bank debt to equity percentage at 9.2%. We can borrow needed funds at a competitive interest rate under the Facility.

Current wording

Although elevated inventory levels in the PLP-USA communications markets and other market headwinds have impacted our 2024 results, we believe our business portfolio and our financial position are sound and strategically well-positioned. We remain focused on assessing our global market opportunities and overall manufacturing capacity in conjunction with the requirements of local manufacturing in the markets that we serve. As necessary, we will modify redundant processes and further utilize our global manufacturing network to manage costs, increase sales volume and deliver value to our customers. Period cost containment has been a priority for the Company in 2024, shown through a reduction in costs and expenses. We have continued to invest in the business to expand into new markets for the Company, evaluate strategic mergers and acquisitions, improve efficiency, develop new products and increase our capacity. As of September 30, 2024, our liquidity remains strong with our bank debt to equity percentage at 8.2%. We can borrow needed funds at a competitive interest rate under the Facility.

Previous wording

Net sales. In 2024, net sales were $138.7 million, a decrease of $43.1 million, or 24%, compared to 2023. Excluding the effect of currency translation, net sales decreased 23% as summarized in the following table:

Current wording

Net sales. In 2024, net sales were $147.0 million, a decrease of $13.5 million, or 8%, compared to 2023. Excluding the effect of currency translation, net sales decreased 8% as summarized in the following table:

Previous wording

The decrease in PLP-USA net sales of $37.1 million, or 38%, was primarily due to lower volumes and unfavorable product mix in communications sales and energy product sales. International net sales for the three months ended June 30, 2024 were unfavorably affected by $1.1 million when local currencies were converted to U.S. dollars. The following discussion of changes in net sales excludes the effect of currency translation. The Americas net sales of $21.8 million increased $0.7 million, or 3%, primarily due to higher volumes in energy product sales. EMEA net sales of $32.0 million decreased $5.3 million, or 14%, primarily due to lower volume in communications sales. Asia-Pacific net sales of $25.0 million decreased $0.4 million, or 1%, primarily due to lower volumes in special industries.

Current wording

The decrease in PLP-USA net sales of $16.2 million, or 20%, was primarily due to lower volumes in communications and energy product sales. International net sales for the three months ended September 30, 2024 were unfavorably affected by $0.8 million when local currencies were converted to U.S. dollars. The following discussion of changes in net sales excludes the effect of currency translation. The Americas net sales of $19.9 million decreased $1.3 million, or 6%, primarily due to lower volumes in energy product sales. EMEA net sales of $32.9 million increased $3.6 million, or 12%, primarily due to higher volume in energy product sales. Asia-Pacific net sales of $28.6 million increased $1.2 million, or 5%, primarily due to higher volumes in energy product sales.

Previous wording

Gross profit. Gross profit of $44.3 million for 2024 decreased $22.1 million, or 33%, compared to 2023. Excluding the effect of currency translation, gross profit decreased $21.8 million, or 33%, as summarized in the following table:

Current wording

Gross profit. Gross profit of $45.8 million for 2024 decreased $8.4 million, or 15%, compared to 2023. Excluding the effect of currency translation, gross profit decreased $8.0 million, or 15%, as summarized in the following table:

Previous wording

PLP-USA gross profit of $20.7 million decreased by $20.5 million, or 50%, compared to the same period in 2023, primarily due to lower sales volumes and unfavorable product mix. International gross profit for the period ended June 30, 2024 was unfavorably impacted by $0.3 million when local currencies were translated to U.S. dollars. The following discussion of gross profit changes excludes the effects of currency translation. The Americas gross profit decreased $1.4 million, or 17%, which was primarily the result of unfavorable product mix and higher manufacturing costs. EMEA gross profit decreased $0.2 million, or 2%, primarily due to lower sales volumes, partially offset by a reduction in warranty expense. Asia-Pacific gross profit increased $0.3 million, or 4%, which was primarily driven by favorable product mix.

Current wording

PLP-USA gross profit of $21.4 million decreased by $9.3 million, or 30%, compared to the same period in 2023, primarily due to lower sales volumes and unfavorable product mix. International gross profit for the period ended September 30, 2024 was unfavorably impacted by $0.4 million when local currencies were translated to U.S. dollars. The following discussion of gross profit changes excludes the effects of currency translation. The Americas gross profit decreased $0.7 million, or 9%, which was primarily the result of lower sales volume. EMEA gross profit increased $1.8 million, or 24%, primarily due to higher sales volumes and favorable product mix. Asia-Pacific gross profit increased $0.2 million, or 3%, which was primarily driven by favorable product mix.

Previous wording

Costs and expenses. Costs and expenses of $65.6 million for the six months ended June 30, 2024 decreased $9.9 million, or 13%, when compared to 2023. Excluding the effect of currency translation, costs and expenses decreased $9.9 million, or 13%, as summarized in the following table:

Current wording

Costs and expenses. Costs and expenses of $35.4 million for the three months ended September 30, 2024 increased $1.3 million, or 4%, when compared to 2023. Excluding the effect of currency translation, costs and expenses increased $1.6 million, or 5%, as summarized in the following table:

Previous wording

PLP-USA costs and expenses of $16.9 million decreased $3.5 million, or 17% year-over-year. PLP-USA’s decrease was primarily attributable to lower selling costs and lower personnel and professional services costs, primarily as a result of cost containment efforts. International costs and expenses for the three months ended June 30, 2024 were unfavorably impacted by $0.3 million when local currencies were translated to U.S. dollars. The following discussion of costs and expenses excludes the effect of currency translation. The Americas costs and expenses of $4.6 million decreased $0.3 million primarily due to lower selling, general, and administrative costs. EMEA costs and expenses of $5.4 million decreased by $1.4 million primarily due to elevated past-due receivable collections which reduced bad debt expenses. Asia-Pacific costs and expenses of $6.0 million increased $0.3 million due to the impact of foreign currency remeasurement.

Current wording

PLP-USA costs and expenses of $17.4 million decreased $1.8 million, or 10% year-over-year. PLP-USA’s decrease was primarily attributable to lower selling costs and lower personnel costs, primarily as a result of cost containment efforts. International costs and expenses for the three months ended September 30, 2024 were favorably impacted by $0.3 million when local currencies were translated to U.S. dollars. The following discussion of costs and expenses excludes the effect of currency translation. The Americas costs and expenses of $5.0 million decreased $0.5 million primarily due to a one-time legal settlement in the third quarter of 2023. EMEA costs and expenses of $7.2 million increased by $1.4 million primarily due to increased selling, general, and administrative costs and the impact of foreign currency remeasurement. Asia-Pacific costs and expenses of $5.8 million increased $2.5 million primarily due to a one-time gain of $2.5 million on the sale of capital assets in the third quarter of 2023.

Previous wording

Other expense, net. Other expense, net of $0.1 million for the three months ended June 30, 2024 was favorable by $0.5 million when compared to Other expense, net for the three months ended June 30, 2023 of $0.6 million. The favorable movement was due to lower interest expense from reduced debt balances and higher interest income earned on cash balances in certain international jurisdictions for the three months ended June 30, 2024.

Current wording

Other income (expense), net. Other income, net for the three months ended September 30, 2024 was favorable by $0.5 million when compared to Other expense, net for the three months ended September 30, 2023 of $0.5 million. The favorable movement was due to lower interest expense from reduced debt balances and higher interest income earned on cash balances in certain international jurisdictions.

Previous wording

Income taxes. Income taxes for the three months ended June 30, 2024 and 2023 were $1.8 million and $7.1 million based on pre-tax income of $11.2 million and $27.5 million, respectively. The tax rate for the three months ended June 30, 2024 and 2023 was 16% and 26%, respectively. The effective tax rate for the three months ended June 30, 2024 was lower than the effective tax rate for the same period in 2023 mainly due to discrete benefits recorded as a result of amending prior year federal tax returns.

Current wording

Income taxes. Income taxes for the three months ended September 30, 2024 and 2023 were $2.7 million and $4.4 million based on pre-tax income of $10.4 million and $19.6 million, respectively. The tax rate for the three months ended September 30, 2024 and 2023 was 26% and 23%, respectively. The effective tax rate for the three months ended September 30, 2024 was higher than the effective tax rate for the same period in 2023 mainly due to limitations on the deductibility of compensation and a lower excess tax benefit on share-based compensation which was partially offset by the favorable impact from the mix of earned income in certain foreign jurisdictions.

Previous wording

Net income. As a result of the preceding items, net income for the three months ended June 30, 2024 was $9.4 million, compared to $20.5 million for 2023. Excluding the effect of currency translation, net income decreased $11.1 million as summarized in the following table. The decrease in net income was due to decreases in operating income described above, partially offset by lower interest expense and lower tax expense:

Current wording

Net income. As a result of the preceding items, net income for the three months ended September 30, 2024 was $7.7 million, compared to $15.1 million for 2023. Excluding the effect of currency translation, net income decreased $7.3 million as summarized in the following table. The decrease in net income was due to decreases in operating income described above, partially offset by lower interest expense and lower tax expense:

Previous wording

SIX MONTHS ENDED JUNE 30, 2024 COMPARED TO SIX MONTHS ENDED JUNE 30, 2023

Current wording

NINE MONTHS ENDED SEPTEMBER 30, 2024 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 2023

Previous wording

The following table sets forth a summary of the Company’s Statements of Consolidated Income and the percentage of net sales for the six months ended June 30, 2024 and 2023. The Company’s past operating results are not necessarily indicative of future operating results.

Current wording

The following table sets forth a summary of the Company’s Statements of Consolidated Income and the percentage of net sales for the nine months ended September 30, 2024 and 2023. The Company’s past operating results are not necessarily indicative of future operating results.

Previous wording

Net sales. In 2024, net sales were $279.6 million, a decrease of $84.0 million, or 23%, compared to 2023. Excluding the effect of currency translation, net sales decreased 23% as summarized in the following table:

Current wording

Net sales. In 2024, net sales were $426.6 million, a decrease of $97.5 million, or 19%, compared to 2023. Excluding the effect of currency translation, net sales decreased 18% as summarized in the following table:

Previous wording

The decrease in PLP-USA net sales of $63.5 million, or 33%, was primarily due to lower volumes and unfavorable product mix in communications sales and energy product sales. International net sales for the six months ended June 30, 2024 were unfavorably affected by $0.3 million when local currencies were converted to U.S. dollars. The following discussion of changes in net sales excludes the effect of currency translation. The Americas net sales of $40.2 million decreased $4.3 million, or 10%, primarily due to lower volumes in communications sales, partially offset by increased volumes in energy product sales. EMEA net sales of $60.7 million decreased $16.5 million, or 22%, primarily due to lower volume in communications sales, partially offset by increased volumes in energy product sales. Asia-Pacific net sales of $48.1 million increased $0.6 million, or 1%, primarily due to volume increases in energy product and special industries sales.

Current wording

The decrease in PLP-USA net sales of $79.7 million, or 29%, was primarily due to lower volumes in communications and energy product sales. International net sales for the nine months ended September 30, 2024 were unfavorably affected by $1.1 million when local currencies were converted to U.S. dollars. The following discussion of changes in net sales excludes the effect of currency translation. The Americas net sales of $60.0 million decreased $5.5 million, or 8%, primarily due to lower volumes in communications sales and energy product sales. EMEA net sales of $93.6 million decreased $12.9 million, or 12%, primarily due to lower volume in communications sales, partially offset by increased volumes in energy product sales. Asia-Pacific net sales of $76.8 million increased $1.8 million, or 2%, primarily due to volume increases in energy product sales and special industries sales.

Previous wording

Gross profit. Gross profit of $88.4 million for 2024 decreased $44.2 million, or 33%, compared to 2023. Excluding the effect of currency translation, gross profit decreased $44.1 million, or 33%, as summarized in the following table:

Current wording

Gross profit. Gross profit of $134.2 million for 2024 decreased $52.6 million, or 28%, compared to 2023. Excluding the effect of currency translation, gross profit decreased $52.1 million, or 28%, as summarized in the following table:

Previous wording

PLP-USA gross profit of $45.4 million decreased by $37.9 million, or 45%, compared to the same period in 2023, primarily due to lower sales volumes and unfavorable product mix. International gross profit for the period ended June 30, 2024 was unfavorably impacted by $0.1 million when local currencies were translated to U.S. dollars. The following discussion of gross profit changes excludes the effects of currency translation. The Americas gross profit decreased $4.6 million, or 29%, which was primarily the result of lower sales volumes. EMEA gross profit decreased $1.3 million, or 7%, primarily due to lower sales volumes, partially offset by favorable resolution of a warranty claim. Asia-Pacific gross profit decreased $0.3 million, or 2%, which was primarily driven by higher manufacturing costs, partially offset by favorable product mix.

Current wording

PLP-USA gross profit of $66.8 million decreased by $47.2 million, or 41%, compared to the same period in 2023, primarily due to lower sales volumes and unfavorable product mix, partially offset by cost containment measures. International gross profit for the period ended September 30, 2024 was unfavorably impacted by $0.5 million when local currencies were translated to U.S. dollars. The following discussion of gross profit changes excludes the effects of currency translation. The Americas gross profit decreased $5.3 million, or 22%, which was primarily the result of lower sales volumes. EMEA gross profit increased $0.5 million, or 2%, primarily due to a favorable resolution of a warranty claim and lower freight costs, offset by an increase in labor costs. Asia-Pacific gross profit decreased $0.1 million, which was primarily driven by favorable product mix.

Previous wording

Costs and expenses. Costs and expenses of $33.0 million for the three months ended June 30, 2024 decreased $5.2 million, or 14%, when compared to 2023. Excluding the effect of currency translation, costs and expenses decreased $4.9 million, or 13%, as summarized in the following table:

Current wording

Costs and expenses. Costs and expenses of $100.9 million for the nine months ended September 30, 2024 decreased $8.6 million, or 8%, when compared to 2023. Excluding the effect of currency translation, costs and expenses decreased $8.4 million, or 8%, as summarized in the following table:

Previous wording

PLP-USA costs and expenses of $35.1 million decreased $5.3 million, or 13% year-over-year. PLP-USA’s decrease was primarily attributable to lower selling costs and lower personnel and professional services costs, primarily as a result of cost containment efforts. International costs and expenses for the six months ended June 30, 2024 had a de minimis impact when local currencies were translated to U.S. dollars. The following discussion of costs and expenses excludes the effect of currency translation. The Americas costs and expenses of $9.4 million decreased $1.3 million primarily due to lower sales and the impact of foreign currency remeasurement. EMEA costs and expenses of $11.5 million decreased by $2.1 million primarily due to lower sales-related costs and bad debt expenses. Asia-Pacific costs and expenses of $9.6 million decreased $1.3 million primarily due to a one-time gain on the sale of capital assets.

Current wording

PLP-USA costs and expenses of $52.5 million decreased $7.1 million, or 12% year-over-year. PLP-USA’s decrease was primarily attributable to lower selling costs and lower personnel and professional services costs, primarily as a result of cost containment efforts. International costs and expenses for the nine months ended September 30, 2024 was unfavorably impacted by $0.3 million when local currencies were translated to U.S. dollars. The following discussion of costs and expenses excludes the effect of currency translation. The Americas costs and expenses of $14.3 million decreased $1.7 million primarily due to a one-time legal settlement in the third quarter of 2023 and the impact of foreign currency remeasurement. EMEA costs and expenses of $18.7 million decreased by $0.7 million primarily due to lower personnel costs and bad debt expenses. Asia-Pacific costs and expenses of $15.4 million increased $1.2 million primarily due to the net impact of the sale of capital assets year over year and foreign currency remeasurement.

Previous wording

Other income (expense), net. Other income, net of $0.2 million for the six months ended June 30, 2024 was favorable by $1.5 million when compared to Other expense, net for the six months ended June 30, 2023 of $1.3 million. The favorable movement was due to higher interest income earned on cash balances in certain international jurisdictions and lower interest expense from reduced debt balances for the six months ended June 30, 2024.

Current wording

Other income (expense), net. Other income, net of $0.2 million for the nine months ended September 30, 2024 was favorable by $2.0 million when compared to Other expense, net for the nine months ended September 30, 2023 of $1.8 million. The favorable movement was due to higher interest income earned on cash balances in certain international jurisdictions and lower interest expense from reduced debt balances for the nine months ended September 30, 2024.

Previous wording

Income taxes. Income taxes for the six months ended June 30, 2024 and 2023 were $4.0 million and $13.9 million based on pre-tax income of $23.0 million and $55.8 million, respectively. The tax rate for the six months ended June 30, 2024 and 2023 was 18% and 25%, respectively. The effective tax rate for the six months ended June 30, 2024 was lower than the effective tax rate for the same period in 2023 mainly due to an increase in excess tax benefits on share-based compensation in relation to overall lower pre-tax book income as well as other discrete benefits recorded as a result of amending prior year federal tax returns.

Current wording

Income taxes. Income taxes for the nine months ended September 30, 2024 and 2023 were $6.8 million and $18.3 million based on pre-tax income of $33.4 million and $75.4 million, respectively. The tax rate for the nine months ended September 30, 2024 and 2023 was 20% and 24%, respectively. The effective tax rate for the nine months ended September 30, 2024 was lower than the effective tax rate for the same period in 2023 mainly due to the favorable impact from discrete benefits recorded as a result of amending prior year federal tax returns and an increase in excess tax benefits on share-based compensation in relation to overall lower pre-tax book income.

Previous wording

Net income. As a result of the preceding items, net income for the six months ended June 30, 2024 was $19.0 million, compared to $41.9 million for 2023. Excluding the effect of currency translation, net income decreased $22.9 million as summarized in the following table. The decrease in net income was due to decreases in operating income described above, partially offset by higher interest income, lower interest expense, and lower tax expense:

Current wording

Net income. As a result of the preceding items, net income for the nine months ended September 30, 2024 was $26.6 million, compared to $57.0 million for 2023. Excluding the effect of currency translation, net income decreased $30.2 million as summarized in the following table. The decrease in net income was due to decreases in operating income described above, partially offset by higher interest income, lower interest expense, and lower tax expense:

Previous wording

Our investments include expenditures required for equipment and facilities as well as expenditures in support of our strategic initiatives. During the first six months of 2024, we used cash of $7.6 million for capital expenditures. We ended the first six months of 2024 with $47.4 million of cash, cash equivalents and restricted cash (collectively, “Cash”). Our Cash is held in various locations throughout the world. At June 30, 2024, the majority of our Cash was held outside the U.S. We expect most accumulated non-U.S. Cash balances will remain outside of the U.S. and that we will meet U.S. liquidity needs through future operating cash flows, use of U.S. Cash balances, external borrowings, or some combination of these sources. We complete comprehensive reviews of our significant customers and their creditworthiness by analyzing financial statements for customers where we have identified a measure of increased risk. We closely monitor payments and developments which may signal possible customer credit issues. We currently have not identified any potential material impact on our liquidity from customer credit issues.

Current wording

Our investments include expenditures required for equipment and facilities as well as expenditures in support of our strategic initiatives. During the first nine months of 2024, we used cash of $11.2 million for capital expenditures. We ended the first nine months of 2024 with $47.5 million of cash, cash equivalents and restricted cash (collectively, “Cash”). Our Cash is held in various locations throughout the world. At September 30, 2024, the majority of our Cash was held outside the U.S. We expect most accumulated non-U.S. Cash balances will remain outside of the U.S. and that we will meet U.S. liquidity needs through future operating cash flows, use of U.S. Cash balances, external borrowings, or some combination of these sources. We complete comprehensive reviews of our significant customers and their creditworthiness by analyzing financial statements for customers where we have identified a measure of increased risk. We closely monitor payments and developments which may signal possible customer credit issues. We currently have not identified any potential material impact on our liquidity from customer credit issues.

Previous wording

Total debt, including notes payable, at June 30, 2024 was $38.6 million. At June 30, 2024, our unused availability under our credit facility (the "Facility") was $73.6 million and our bank debt to equity percentage was 9.2%. The Facility contains, among other provisions, requirements for maintaining levels of net worth and profitability. At June 30, 2024, the Company was in compliance with these covenants.

Current wording

Total debt, including notes payable, at September 30, 2024 was $35.2 million. At September 30, 2024, our unused availability under our credit facility (the "Facility") was $77.2 million and our bank debt to equity percentage was 8.2%. The Facility contains, among other provisions, requirements for maintaining levels of net worth and profitability. At September 30, 2024, the Company was in compliance with these covenants.

Previous wording

On January 19, 2021, the Company received funding for a term loan from PNC Equipment Finance, LLC in the principal amount of $20.5 million for the full amount of the purchase price for a new corporate aircraft. The term of the loan is 120 months at a fixed interest rate of 2.744%. The loan is payable in 119 equal monthly installments, which commenced on March 1, 2021 with a final payment of any outstanding principal and accrued interest due and payable on the final monthly payment date. Of the $13.7 million outstanding on this debt facility at June 30, 2024, $2.1 million was classified as current. The loan is secured by the aircraft.

Current wording

On January 19, 2021, the Company received funding for a term loan from PNC Equipment Finance, LLC in the principal amount of $20.5 million for the full amount of the purchase price for a new corporate aircraft. The term of the loan is 120 months at a fixed interest rate of 2.744%. The loan is payable in 119 equal monthly installments, which commenced on March 1, 2021 with a final payment of any outstanding principal and accrued interest due and payable on the final monthly payment date. Of the $13.2 million outstanding on this debt facility at September 30, 2024, $2.1 million was classified as current. The loan is secured by the aircraft.

Previous wording

Net cash provided by operating activities for the six months ended June 30, 2024 was $34.0 million compared to $45.9 million in the comparable prior year six-month period. The $11.9 million decrease was primarily a result of a decrease in net income and larger payables balances, which outpaced increases in current assets, primarily accounts receivable, inventory and prepaid expenses.

Current wording

Net cash provided by operating activities for the nine months ended September 30, 2024 was $43.4 million compared to $88.4 million in the comparable prior year nine-month period. The $45.0 million decrease was primarily a result of a decrease in net income and changes in operating assets and liabilities.

Previous wording

Net cash used in investing activities for the six months ended June 30, 2024 was $4.3 million compared to $29.1 million in the comparable prior year six-month period. The $24.8 million change was primarily a result of decreases in acquisition activity and capital expenditures during the current period.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2024 was $7.7 million compared to $36.7 million in the comparable prior year nine-month period. The $29.0 million change was primarily a result of decreases in acquisition activity and capital expenditures during the current period.

Previous wording

Net cash used in financing activities for the six months ended June 30, 2024 was $33.5 million compared to $11.7 million in the comparable prior year six-month period. The $21.8 million change was primarily the result of increased net payments of long-term debt.

Current wording

Net cash used in financing activities for the nine months ended September 30, 2024 was $40.8 million compared to $45.5 million in the comparable prior year nine-month period. The $4.7 million change was primarily the result of increased net payments of long-term debt and decreased purchases of common shares from related parties.

Previous wording

We have commitments under operating leases primarily for office and manufacturing space, transportation equipment, office and computer equipment and finance leases primarily for equipment. At June 30, 2024, we had $1.6 million of current operating lease liabilities and $7.0 million of noncurrent operating lease liabilities. Total liabilities related to finance lease obligations were less than $0.7 million at June 30, 2024.

Current wording

We have commitments under operating leases primarily for office and manufacturing space, transportation equipment, office and computer equipment and finance leases primarily for equipment. At September 30, 2024, we had $1.6 million of current operating lease liabilities and $7.0 million of noncurrent operating lease liabilities. Total liabilities related to finance lease obligations were less than $0.6 million at September 30, 2024.

Previous wording

As of June 30, 2024, the Company had total outstanding guarantees of $12.9 million. Additionally, certain domestic and foreign customers require the Company to issue letters of credit or performance bonds as a condition of placing an order. As of June 30, 2024, the Company had total outstanding letters of credit of $0.9 million.

Current wording

As of September 30, 2024, the Company had total outstanding guarantees of $12.2 million. Additionally, certain domestic and foreign customers require the Company to issue letters of credit or performance bonds as a condition of placing an order. As of September 30, 2024, the Company had total outstanding letters of credit of $1.0 million.

Previous wording

The Company has borrowing facilities at certain of its foreign subsidiaries, which consist of overdraft lines, working capital credit lines, and facilities for the issuance of letters of credit and short-term borrowing needs. At June 30, 2024, and December 31, 2023, $8.5 million and $13.3 million was outstanding, of which $7.7 million and $11.4 million were classified as current, respectively. These facilities support commitments made in the ordinary course of business.

Current wording

The Company has borrowing facilities at certain of its foreign subsidiaries, which consist of overdraft lines, working capital credit lines, and facilities for the issuance of letters of credit and short-term borrowing needs. At September 30, 2024, and December 31, 2023, $9.3 million and $13.3 million was outstanding, of which $8.6 million and $11.4 million were classified as current, respectively. These facilities support commitments made in the ordinary course of business.