HUBBELL INC

Previous wording

Hubbell is a global manufacturer of quality electrical products and utility solutions for a broad range of customer and end market applications. We provide utility and electrical solutions that enable our customers to operate critical infrastructure reliably and efficiently, and we empower and energize communities through innovative solutions supporting energy infrastructure In Front of the Meter, on The Edge, and Behind the Meter. In Front of the Meter is where utilities transmit and distribute energy to their customers. The Edge connects utilities with owner/operators and allows energy and data to be distributed back and forth. Behind the Meter is where owners and operators of buildings and other critical infrastructure consume energy. Products are either sourced complete, manufactured or assembled by subsidiaries in the United States, Canada, Puerto Rico, Mexico, China, the UK, Brazil, Australia, Spain, Ireland and the Republic of the Philippines. The Company also participates in joint ventures in Hong Kong and the Republic of the Philippines, and maintains offices in Singapore, Italy, China, India, Mexico, South Korea, Chile, and countries in the Middle East. The Company employed approximately 18,000 individuals worldwide as of September 30, 2024.

Current wording

Hubbell is a global manufacturer of quality electrical products and utility solutions for a broad range of customer and end market applications. We provide utility and electrical solutions that enable our customers to operate critical infrastructure reliably and efficiently, and we empower and energize communities through innovative solutions supporting energy infrastructure In Front of the Meter, on The Edge, and Behind the Meter. In Front of the Meter is where utilities transmit and distribute energy to their customers. The Edge connects utilities with owner and operators and allows energy and data to be distributed back and forth. Behind the Meter is where owners and operators of buildings and other critical infrastructure consume energy. Products are either sourced complete, manufactured or assembled by subsidiaries in the United States, Canada, Puerto Rico, Mexico, China, the UK, Brazil, Australia, Spain, Ireland and the Republic of the Philippines. The Company also participates in joint ventures in Hong Kong and the Republic of the Philippines, and maintains offices in Singapore, Italy, China, India, Mexico, South Korea, Chile, and countries in the Middle East. The Company employed approximately 17,700 individuals worldwide as of March 31, 2025.

Previous wording

Results for the nine months ended September 30, 2024 by segment are included under “Segment Results” within this Management’s Discussion and Analysis.

Current wording

Results for the three months ended March 31, 2025 by segment are included under “Segment Results” within this Management’s Discussion and Analysis.

Previous wording

Our sales are also subject to market conditions that may cause customer demand for our products to be volatile and unpredictable. Product demand can be affected by fluctuations in domestic and international economic conditions, as well as currency fluctuations, commodity costs, and a variety of other factors. Since early 2021, we have experienced significant inflationary pressure across much of our business. As a result, we have taken various pricing actions to cover the higher costs and protect our profitability. Although the inflation has moderated considerably since its high point in 2022, we expect inflation to remain a factor for the foreseeable future and we expect to continue to take these pricing actions subject to demand and market conditions. Accordingly, there can be no assurance that we will be able to maintain our margins in response to further changes in inflationary pressures. In addition, macroeconomic effects such as increases in interest rates and other measures taken by central banks and other policy makers could have a negative effect on overall economic activity which could reduce our customers’ demand for our products, and cause the continuation of relatively high market interest rates that increase our borrowing costs. Additionally, international tensions, such as the conflicts in the Middle East and Ukraine, as well as trade and other tensions, including those with China may affect demand for our products, as well as our production costs.

Current wording

Our sales are also subject to market conditions that may cause customer demand for our products to be volatile. Product demand can be affected by fluctuations in domestic and international economic conditions, as well as currency fluctuations, commodity costs, and a variety of other factors. Since early 2021, we have experienced significant inflationary pressure across much of our business. As a result, we have taken various pricing actions to cover the higher costs and to protect our profitability. Although inflation has moderated since its high point in 2022, we expect inflation to remain a factor for the foreseeable future and we expect to continue to take these pricing actions subject to demand and market conditions. Accordingly, there can be no assurance that we will be able to maintain our margins in response to further changes in inflationary pressures. In addition, macroeconomic effects such as increases in interest rates and other measures taken by central banks and other policy makers could have a negative effect on overall economic activity which could reduce our customers’ demand for our products, and cause the continuation of relatively high market interest rates that increase our borrowing costs.

Previous wording

The following is a discussion and analysis of our business, financial condition and results of operations as of and for the three and nine months ended September 30, 2024 and 2023. This discussion and analysis should be read in conjunction with our Condensed Consolidated Financial Statements and notes thereto in Item 1 of this Quarterly Report on Form 10-Q (the“Condensed Financial Statements”), and the audited consolidated financial statements, accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Current wording

The following is a discussion and analysis of our business, financial condition and results of operations as of and for the three months ended March 31, 2025 and 2024. This discussion and analysis should be read in conjunction with our Condensed Consolidated Financial Statements and notes thereto in Item 1 of this Quarterly Report on Form 10-Q (the“Condensed Financial Statements”), and the audited consolidated financial statements, accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Previous wording

Third quarter 2024 net sales were$1,442.6 million and grew by 5%, including 6% growth from acquisitions net of divestitures, partially offset by a 1% contraction of organic net sales driven by lower volume.

Current wording

First quarter 2025 net sales were$1,365.2 million and decreased by 2.4%, driven by a 1.2% decline from divestitures net of acquisitions, and a 0.6% contraction of organic net sales driven by lower volume.

Previous wording

In December 2023, the Company entered into a definitive agreement to sell its residential lighting business for a cash purchase price of $131 million, subject to customary adjustments. The Company concluded the business met the criteria for classification as held for sale in the fourth quarter of 2023. The residential lighting business was reported within the Electrical Solutions Segment. The transaction closed in the first quarter of 2024 and the Company recorded a pre-tax loss on the sale of $5.3 million in the first quarter of 2024, which is recorded within Total other expense in the Company's Condensed Consolidated Statement of Income.

Current wording

In December 2023, the Company entered into a definitive agreement to sell its residential lighting business for a cash purchase price of $131 million, subject to customary adjustments. The residential lighting business was reported within the Electrical Solutions Segment. The decline from divestitures reflects the sale of that business, which contributed $21.1 million to first quarter 2024 net sales prior to the closing of that transaction, and is partially offset by a modest contribution to net sales from the acquisition of Ventev in the first quarter of 2025.

Previous wording

Operating margin in the third quarter of 2024 was 21.1% and expanded by 100 basis points. Adjusted operating margin, which excludes amortization of acquisition-related intangibles and transaction, integration and separation costs, was 23.2% and expanded by 180 basis points. Margin expansion in the quarter was primarily driven by favorable price realization and benefits from operational productivity, as well as the impact of recent portfolio transformation efforts, and higher prior year investments in the business. Those factors were partially offset by continued material and other cost inflation. These factors are further described within Segment Results below.

Current wording

Operating margin in the first quarter of 2025 expanded by 120 basis points to 17.5% and includes the effect of lower amortization of acqusition-related intangibles and transaction, integration and separation costs in the first quarter of 2025. Adjusted operating margin, which excludes amortization of acquisition-related intangibles and transaction, integration and separation costs, was 19.3% and contracted by 40 basis points. That result includes margin expansion in the quarter primarily driven by benefits from operational productivity and favorable price realization, however, those factors were more than overcome by contraction driven by continued material and other cost inflation, including tariff expense and the impact of lower volumes. See the further discussion within Segment Results below.

Previous wording

In the following discussion of results of operations, we refer to “adjusted” operating measures. We believe those adjusted measures, which exclude the impact of certain costs, gains and losses, may provide investors with useful information regarding our underlying performance from period to period and allow investors to understand our results of operations without regard to items that, in management's judgement, significantly affect the comparability of operating results, or that are not considered to be components of our core operating performance.

Current wording

In the following discussion of results of operations, we refer to “adjusted” operating measures. We believe those adjusted measures, which exclude the impact of certain costs, gains and losses, may provide investors with useful information regarding our underlying performance from period to period and allow investors to understand our results of operations without regard to items that, in management's judgement, significantly affect the comparability of operating results, or are not considered to be components of our core operating performance.

Previous wording

The effects that acquisitions and divestitures may have on our results fluctuate significantly based on the timing, size and number of transactions, and therefore result in significant volatility in the costs to complete transactions and to integrate or separate the businesses.

Current wording

The effect that acquisitions and divestitures may have on our results fluctuate significantly based on the timing, size and number of transactions, and therefore result in significant volatility in the costs to complete transactions and to integrate or separate the businesses.

Previous wording

The acquisition and divestiture actions taken by the Company in the fourth quarter of 2023 resulted in a significant increase in integration and separation costs. As a result, we believe excluding costs relating to these fourth quarter transactions provides useful and more comparable information for investors to better assess our operating performance.

Current wording

The acquisition and divestiture actions taken by the Company in the fourth quarter of 2023 resulted in a significant increase in integration and separation costs. As a result, we believe excluding costs relating to these 2023 fourth quarter transactions provides useful and more comparable information for investors to better assess our operating performance.

Previous wording

Certain of the Company's adjusted measures exclude these gains or losses because we believe it enhances management's and investors' ability to analyze underlying business performance and facilitates comparisons of our financial results over multiple periods. In the first quarter of 2024 the Company recognized a$5.3 million pre-tax loss on the disposition of the residential lighting business.

Current wording

Certain of the Company's adjusted measures exclude these gains or losses because we believe they enhance management's and investors' ability to analyze underlying business performance and facilitate comparisons of our financial results over multiple periods. In the first quarter of 2024 the Company recognized a$5.3 million pre-tax loss on the disposition of the residential lighting business and also recognized $6.8 million of income tax expense relating to that transaction, primarily driven by differences between book and tax basis in goodwill. That loss and the related income tax expense are excluded from our adjusted operating measures.

Previous wording

Organic net sales (or organic net sales growth), a non-GAAP measure, represents Net sales according to U.S. GAAP, less Net sales from acquisitions and divestitures during the first twelve months of ownership or divestiture, respectively, less the effect of fluctuations in Net sales from foreign currency exchange. The period-over-period effect of fluctuations in Net sales from foreign currency exchange is calculated as the difference between local currency Net sales of the prior period translated at the current period exchange rate as compared to the same local currency Net sales translated at the prior period exchange rate. We believe this measure provides management and investors with a more complete understanding of the underlying operating results and trends of established, ongoing operations by excluding the effect of acquisitions, dispositions and foreign currency as these activities can obscure underlying trends. When comparing Net sales growth between periods, excluding the effects of acquisitions, business dispositions and currency exchange rates, those effects are different when comparing results for different periods. For example, because Net sales from acquisitions are considered inorganic from the date we complete an acquisition through the end of the first year following the acquisition, Net sales from such acquisition are reflected as organic net sales thereafter.

Current wording

Organic net sales (or organic net sales growth), a non-GAAP measure, represents Net sales according to U.S. GAAP, less Net sales from acquisitions and divestitures during the first twelve months of ownership or divestiture, respectively, less the effect of fluctuations in Net sales from foreign currency exchange. The period-over-period effect of fluctuations in Net sales from foreign currency exchange is calculated as the difference between local currency Net sales of the prior period translated at the current period exchange rate as compared to the same local currency Net sales translated at the prior period exchange rate. We believe this measure provides management and investors with a more complete understanding of the underlying operating results and trends of established, ongoing operations by excluding the effect of acquisitions, dispositions and foreign currency as these activities can obscure underlying trends. When comparing Net sales growth between periods, excluding the effects of acquisitions, business dispositions and currency exchange rates, those effects are different when comparing results for different periods. For example, because Net sales from acquisitions are considered inorganic from the date we complete an acquisition through the end of the first year following the acquisition, Net sales from such acquisitions are reflected as organic net sales thereafter.

Previous wording

Net sales of $1,442.6 million in the third quarter of 2024 increased by $66.8 million compared to the third quarter of 2023. Organic net sales decreased by 1.0% driven by a low single digit percentage decrease in volumes, partially offset by a low single digit increase in price realization. Acquisitions net of divestitures contributed 6.1% to net sales growth. These changes are discussed in more detail in the Segment Results section below.

Current wording

Net sales of $1,365.2 million in the first quarter of 2025 decreased by $33.9 million compared to the first quarter of 2024. Organic net sales decreased by 0.6% driven by a low single digit percentage decrease in volumes, partially offset by a low single digit increase in price realization. Divestitures net of acquisitions reflect a 1.2% reduction to net sales, while foreign exchange resulted in a 0.6% decrease in net sales. These changes are discussed in more detail in the Segment Results section below.

Previous wording

As a percentage of Net sales, cost of goods sold increased by 90 basis points to 65.5% in the third quarter of 2024, resulting in gross profit margin contracting to 34.5%. Approximately four percentage points of gross profit margin contraction was driven by higher intangible amortization expense, material and other cost inflation and lower volume, which was partially offset by approximately three percentage points of margin expansion driven by favorable price realization and improved operational productivity.

Current wording

As a percentage of Net sales, cost of goods sold decreased by 110 basis points to 66.9% in the first quarter of 2025, resulting in gross profit margin expanding to 33.1%. Approximately four percentage points of gross profit margin expansion was driven by lower acquisition-related intangible asset amortization, improved operational productivity and favorable price realization, partially offset by three percentage points of gross profit margin contraction due to material and other cost inflation, including tariff expense and lower volume.

Previous wording

S&A expense in the third quarter of 2024 was $193.3 million and decreased by $17.8 million or 8.4% compared to the prior year period. This decrease was driven by higher investments in the business in prior year, including professional services, as well as lower employee incentive expense in the current year, partially offset by the impact of the 2023 acquisitions net of divestitures. S&A expense as a percentage of Net sales was 13.4% in the third quarter of 2024, compared to 15.3% in the third quarter of 2023.

Current wording

S&A expense in the first quarter of 2025 was $212.2 million and decreased by $7.0 million or 3.2% compared to the prior year period. This decrease was primarily driven by lower transaction, integration and separation costs in the current year compared to the prior year. S&A expense as a percentage of Net sales was 15.6% in the first quarter of 2025, compared to 15.7% in the first quarter of 2024.

Previous wording

The effective tax rate in the third quarter of 2024 decreased to 20.9% as compared to 23.8% in the third quarter of 2023, primarilydue to the tax benefits of an international restructuring completed during the third quarter of 2024.

Current wording

The effective tax rate in the first quarter of 2025 decreased to 22.2% as compared to 26.0% in the first quarter of 2024, primarilydue to income tax expense incurred in the first quarter of 2024 relating to the divestiture of our residential lighting business.

Previous wording

Net income attributable to Hubbell Incorporated was $219.4 million in the third quarter of 2024 and increased 9.6% as compared to the same period of the prior year, reflecting the factors described above. As a result, earnings per diluted share in the third quarter of 2024 increased 9% as compared to the third quarter of 2023. Adjusted net income attributable to Hubbell Incorporated, which excludes amortization of acquisition-related intangibles from both periods and transaction, integration & separation costs in the third quarter of 2024, was $242.9 million in the third quarter of 2024 and increased by 13.6% as compared to the third quarter of 2023.

Current wording

Net income attributable to Hubbell Incorporated was $169.7 million in the first quarter of 2025 and increased 14.8% as compared to the same period of the prior year, reflecting the factors described above. As a result, earnings per diluted share in the first quarter of 2025 increased 15% as compared to the first quarter of 2024. Adjusted net income attributable to Hubbell Incorporated, which excludes amortization of acquisition-related intangible assets and transaction, integration & separation costs for both periods and the loss on disposition of a business for the first quarter of 2024, was $188.6 million in the first quarter of 2025 and decreased by 3.4% as compared to the first quarter of 2024.

Previous wording

Net sales in the Utility Solutions segment in the third quarter of 2024 were $933.1 million, and increased by $95.2 million, or 11.3%, as compared to the third quarter of 2023. That increase was driven by a 15.3% increase in net sales from acquisitions, partially offset by a 3.8% decrease in organic net sales. The decrease in organic net sales was driven by a mid single digit percentage decrease in unit volume, partially offset by a low single digit increase in price realization. The decrease in unit volume resulted largely from volume declines in enclosures products led by a decline in the telcom markets as well as utility distribution markets continued to reflect the impact of customer inventory normalization. This was partially offset by robust growth in transmission and substation markets.

Current wording

Net sales in the Utility Solutions segment in the first quarter of 2025 were $857.1 million, and decreased by $36.9 million, or 4.2%, as compared to the first quarter of 2024. That decrease was driven by a 3.7% decrease in organic net sales, and a 0.5% decrease due to foreign exchange. The decrease in organic net sales was driven by a mid single digit percentage decrease in unit volume, partially offset by a low single digit increase in price realization. The decrease in unit volume resulted largely from volume declines in Grid Automation products on the timing of large metering and AMI projects which drove a stronger first quarter of 2024, as well as in enclosures products led by lower volume in telcom markets.

Previous wording

Operating income in the Utility Solutions segment for the third quarter of 2024 was $210.5 million, an increase of 12.7% compared to the third quarter of 2023. Operating margin increased by 30 basis points to 22.6% in the third quarter of 2024, as compared to the same period of 2023. Excluding amortization of acquisition-related intangibles and transaction, integration and separation costs, the adjusted operating margin increased by 130 basis points to 25.3%, as compared to the 2023 period. The increase in operating margin includes approximately four percentage points of margin expansion primarily due to favorable price realization, improved operational productivity, and higher prior year investments in the business, partially offset by approximately three percentage points of margin contraction primarily due to material and other cost inflation and lower unit volume. The impact of lower unit volume includes approximately 100 basis points of contraction from enclosures products, driven primarily by weakness in the telcom market.

Current wording

Operating income in the Utility Solutions segment for the first quarter of 2025 was $160.0 million, an increase of 1.6% compared to the first quarter of 2024. Operating margin increased by 110 basis points to 18.7% in the first quarter of 2025, and includes the effect of lower amortization of acqusition-related intangible assets and transaction, integration & separation costs. Excluding amortization of acquisition-related intangible assets and transaction, integration & separation costs, the adjusted operating margin decreased by 80 basis points to 21.0%. That decrease includes approximately four percentage points of margin contraction due to material and other cost inflation, including tariff expense and the impact of lower unit volume, which was partially offset by three percentage points of margin expansion from improved operational productivity and favorable price realization.

Previous wording

Net sales in the Electrical Solutions segment in the third quarter of 2024 were $509.5 million and decreased by $28.4 million, or 5.3%, as compared to the third quarter of 2023. That decrease includes 3.4% growth in organic net sales, which was more than offset by an 8.5% decline in net sales resulting from the disposition of the residential lighting business during the first quarter of 2024. The increase in organic net sales was driven by a low single digit percentage increase in unit volume and a low single digit percentage increase in price realization. Volume growth in the quarter was driven primarily by strength in datacenter and renewables markets, while broader industrial markets were steady and commercial markets were softer. Favorable price realization was driven primarily by actions to recover inflationary costs.

Current wording

Net sales in the Electrical Solutions segment in the first quarter of 2025 were $508.1 million and increased by $3.0 million, or 0.6%, as compared to the first quarter of 2024. That increase includes 4.8% growth in organic net sales, which was partially offset by a 3.3% decline in net sales resulting from divestitures net of acquisitions and a 0.9% decline due to foreign exchange. The increase in organic net sales was driven by a low single digit percentage increase in unit volume and a low single digit percentage increase in price realization. Volume growth in the first quarter of 2025 was driven primarily by strength in the datacenter market, while broader industrial markets were steady and commercial markets were softer.

Previous wording

Operating income in the Electrical Solutions segment for the third quarter of 2024 was $93.3 million and increased approximately 4.2% compared to the third quarter of 2023, while operating margin in the third quarter of 2024 expanded by 170 basis points to 18.3%. Excluding amortization of acquisition-related intangibles and transaction, integration and separation cost, the adjusted operating margin expanded by 190 basis points to 19.4%. The increase in operating margin was primarily due to approximately five percentage points of margin expansion from favorable price realization, improved operational productivity and higher volume. The disposition of the residential lighting business also contributed to that expansion. Those factors were partially offset by approximately three percentage points of margin contraction driven by higher material and other cost inflation and mix.

Current wording

Operating income in the Electrical Solutions segment for the first quarter of 2025 was $79.0 million and increased by 11.3% compared to the first quarter of 2024, while operating margin in the first quarter of 2025 expanded by 140 basis points to 15.5%. Excluding amortization of acquisition-related intangibles and transaction, integration and separation costs, the adjusted operating margin expanded by 70 basis points to 16.5%. The increase in operating margin was primarily due to approximately four percentage points of margin expansion from improved operational productivity, favorable price realization, lower transaction, integration & separation costs and higher volume. Those factors were partially offset by approximately three percentage points of margin contraction driven by higher material and other cost inflation, including tariff expense and mix.

Previous wording

Cash provided by operating activities for the nine months ended September 30, 2024 was$558.8 million compared to cash provided by operating activities of $535.3 million for the same period in 2023. The increase in cash provided by operations is due to higher income, after adjusting for the effect of non-cash items, primarily depreciation and amortization expense. That increase was partially offset by higher investments in working capital to serve customer demand.

Current wording

Cash provided by operating activities for the three months ended March 31, 2025 was$37.4 million compared to cash provided by operating activities of $92.2 million for the same period in 2024. The decrease in cash provided by operations is due to an increase in working capital, primarily within accounts receivable driven by the timing of sales, a $20.0 million contribution to our pension plan, and lower depreciation and amortization expense in 2025. Those factors are partially offset by higher net income and a lower use of cash for incentive payments in the first quarter of 2025 compared to the same prior year period.

Previous wording

Cash provided by investing activities was $20.0 million in the nine months ended September 30, 2024 compared to cash used of $161.4 million during the comparable period in 2023. This change was driven by $122.9 million of cash proceeds in 2024 from the disposition of our residential lighting business as compared to a $60.0 million cash outflow in 2023 for the acquisition of EIG.

Current wording

Cash used by investing activities was $99.3 million in the three months ended March 31, 2025 compared to cash provided of $88.6 million during the comparable period in 2024. This change was driven by $73.3 million of cash used in the first quarter of 2025 to acquire Ventev, and $122.9 million of cash proceeds in the first quarter of 2024 from the disposition of our residential lighting business.

Previous wording

Cash used in financing activities was $476.4 million in the nine months ended September 30, 2024 as compared to cash used of $241.7 million in the comparable period of 2023. The increase in cash used primarily reflects higher repayments of long and short-term borrowings in the first nine months of 2024 compared to the same prior year period.

Current wording

Cash provided by financing activities was $75.0 million in the three months ended March 31, 2025 as compared to cash used of $125.3 million in the comparable period of 2024. The increase in cash provided by financing activities primarily reflects higher net borrowings partially offset by a $115.0 million increase in share repurchases in the first three months of 2025 compared to the same prior year period.

Previous wording

The unfavorable impact of foreign currency exchange rates on cash was $3.2 million for the nine months ended September 30, 2024 and the change compared to prior year is primarily related to strengthening of the U.S. Dollar against the Mexican Peso, Brazilian Real and Canadian Dollar.

Current wording

The favorable impact of foreign currency exchange rates on cash was $4.1 million for the three months ended March 31, 2025 and the change compared to prior year is primarily related to the U.S. Dollar weakening against the Brazilian Real and British Pound.

Previous wording

We continue to invest in restructuring and related programs to maintain a competitive cost structure, to drive operational efficiencies and to mitigate the impact of rising material costs and administrative cost inflation. We expect our investment in restructuring and related activities to continue through 2025 as we continue to invest in previously initiated actions and initiate further footprint consolidation, and other cost reduction initiatives.

Current wording

We also continue to invest in restructuring and related programs to maintain a competitive cost structure, to drive operational efficiencies and to mitigate the impact of rising material costs and administrative cost inflation. We expect our investments in restructuring and related activities to continue through 2025 as we continue to invest in previously initiated actions and initiate further footprint consolidation, and other cost reduction initiatives.

Previous wording

The table below presents the restructuring and related costs incurred in the first nine months of 2024, additional expected costs, and the expected completion date of restructuring actions that have been initiated as of September 30, 2024 and in prior years (in millions):

Current wording

The table below presents the restructuring and related costs incurred in the first three months of 2025, additional expected costs, and the expected completion date of restructuring actions that have been initiated as of March 31, 2025 and in prior years (in millions):

Previous wording

In October 2022, the Board of Directors approved a share repurchase program that authorized the repurchase of up to $300 million of common stock, which expires in October 2025. In the first nine months of 2024, the Company repurchased$30.0 million of shares of common stock authorized under the October 2022 program. At September 30, 2024, our remaining share repurchase authorization was $270.0 million. Subject to numerous factors, including market conditions and alternative uses of cash, we may conduct discretionary repurchases through open market or privately negotiated transactions, which may include repurchases under plans complying with Rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended.

Current wording

On October 21, 2022, our Board of Directors approved a share repurchase program (the “2022 Program”) that authorized the repurchase of up to $300 million of common stock, which expires in October 2025. At March 31, 2025, our remaining share repurchase authorization under the 2022 Program was $135.0 million. On February 12, 2025, our Board of Directors approved a new stock repurchase program (the “2025 Program”) that authorized the repurchase of up to $500.0 million of common stock and expires in February 2028. When combined with the $135.0 million of remaining share repurchase authorization under the 2022 Program, we have a total outstanding share repurchase authorization of approximately $635.0 million. Subject to numerous factors, including market conditions and alternative uses of cash, we may conduct discretionary repurchases through open market or privately negotiated transactions, which may include repurchases under plans complying with Rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended.

Previous wording

At September 30, 2024 and December 31, 2023, the Company had $1,640.3 million and $2,023.2 million, respectively, of long-term debt outstanding, net of the unamortized balance of capitalized debt issuance costs. The Company had $15.0 million and $15.0 million at September 30, 2024 and December 31, 2023, respectively, of maturities due within the next 12 months related to the Term Loan Agreement described below, which were classified within short term debt in the Consolidated Balance Sheet.

Current wording

At March 31, 2025 and December 31, 2024, the Company had $1,044.0 million and $1,442.7 million, respectively, of long-term debt outstanding, net of the unamortized balance of capitalized debt issuance costs. At March 31, 2025, the Company also had $399.4 million of long-term debt maturing within the next 12 months relating to the 2026 Notes described below, which is classified within short term debt in the Condensed Consolidated Balance Sheets.

Previous wording

On March 12, 2021, the Company, as borrower, and its subsidiaries Hubbell Power Holdings S.à r.l. and Harvey Hubbell Holdings S.à r.l., each as a subsidiary borrower (collectively, the “Subsidiary Borrowers”) entered into a new five-year credit agreement with a syndicate of lenders and JPMorgan Chase Bank, N.A., as administrative agent, that provides a $750 million committed revolving credit facility (the “2021 Credit Facility”). Commitments under the 2021 Credit Facility may be increased to an aggregate amount not to exceed $1.25 billion. The 2021 Credit Facility includes a $50 million sub-limit for the issuance of letters of credit. The sum of the dollar amount of loans and letters of credits to the Subsidiary Borrowers under the 2021 Credit Facility may not exceed $75 million. There were no borrowings outstanding under the 2021 Credit Facility at September 30, 2024.

Current wording

Commitments under the Revolving Credit Agreement may be conditionally increased to an aggregate amount not to exceed $1.5 billion. The Revolving Credit Agreement includes a $50.0 million sub-limit for the issuance of letters of credit. The sum of the dollar amount of loans and letters of credits to the Foreign Subsidiary Borrowers under the Revolving Credit Agreement may not exceed $100.0 million.

Previous wording

The interest rate applicable to borrowings under the 2021 Credit Facility is either (i) the alternate base rate (as defined in the 2021 Credit Facility) or (ii) the adjusted SOFR rate (as defined in the 2021 Credit Facility) plus an applicable margin based on the Company’s credit ratings. All revolving loans outstanding under the 2021 Credit Facility will be due and payable on March 12, 2026.

Current wording

The interest rate applicable to borrowings under the Revolving Credit Agreement is either (i) the alternate base rate (as defined in the Revolving Credit Agreement) or (ii) the term SOFR rate (as defined in the Revolving Credit Agreement) plus an applicable margin based on the Company's credit ratings.

Previous wording

The 2021 Credit Facility contains a financial covenant requiring that, as of the last day of each fiscal quarter, the ratio of total indebtedness to total capitalization shall not be greater than 65%. The Company was in compliance with this covenant as of September 30, 2024. As of September 30, 2024, the 2021 Credit Facility was undrawn.

Current wording

The Revolving Credit Agreement contains a sole financial covenant requiring that, as of the last day of each fiscal quarter, the ratio of total indebtedness to total capitalization shall not be greater than 65%. The Company was in compliance with this covenant as of March 31, 2025.

Previous wording

The carrying value of the Notes, net of unamortized discount and the unamortized balance of capitalized debt issuance costs, was $1,442.1 million and $1,440.3 million at September 30, 2024 and December 31, 2023, respectively.

Current wording

The carrying value of the Notes, net of unamortized discount and the unamortized balance of capitalized debt issuance costs, including $399.4 million relating to the 2026 Notes classified as current, was $1,443.4 million and $1,442.7 million at March 31, 2025 and December 31, 2024, respectively.

Previous wording

The Company had $291.2 million and $117.4 million of short-term debt and current portion of long-term debt outstanding at September 30, 2024 and December 31, 2023, respectively, composed of the following:

Current wording

The Company had $816.1 million and $125.4 million of short-term debt and current portion of long-term debt outstanding at March 31, 2025 and December 31, 2024, respectively, composed of the following:

Previous wording

•$274.0 million of commercial paper borrowings outstanding at September 30, 2024, and $100.0 million of commercial paper borrowings outstanding at December 31, 2023, which was used to partially fund the Systems Control acquisition.

Current wording

•$415.0 million of commercial paper borrowings outstanding at March 31, 2025, and $123.0 million of commercial paper borrowings outstanding at December 31, 2024. The increase in commercial paper during the first three months of 2025 was utilized to repurchase $125.0 million of treasury stock and to fund the $73.3 million acquisition of Ventev.

Previous wording

•$2.2 million and $2.4 million of other short term debt outstanding at September 30, 2024 and December 31, 2023, respectively, which consisted of borrowings to support our international operations in China and amounts outstanding under our commercial card program.

Current wording

•$1.7 million and $2.4 million of other short term debt outstanding at March 31, 2025 and December 31, 2024, respectively, which consisted of borrowings to support our international operations in China and amounts outstanding under our commercial card program.

Previous wording

We measure liquidity on the basis of our ability to meet short-term and long-term operational funding needs, to fund additional investments in our business, including acquisitions, and to make dividend payments to shareholders. Significant factors affecting the management of liquidity are cash flows from operating activities, capital expenditures, cash dividend payments, stock repurchases, access to bank lines of credit and our ability to attract long-term capital with satisfactory terms. In the first nine months of 2024, we returned capital to our shareholders by paying $196.5 million of dividends on our common stock and using $30.0 million of cash for share repurchases.

Current wording

We measure liquidity on the basis of our ability to meet short-term and long-term operational funding needs, to fund additional investments in our business, including acquisitions, and to make dividend payments to shareholders. Significant factors affecting the management of liquidity are cash flows from operating activities, capital expenditures, cash dividend payments, stock repurchases, access to bank lines of credit and our ability to attract long-term capital with satisfactory terms. In the first three months of 2025, we returned capital to our shareholders by paying $70.7 million of dividends on our common stock and using $125.0 million of cash for share repurchases.

Previous wording

◦Cash flows from operating activities and existing cash resources: In addition to cash flows from operating activities, we also had $435.7 million of cash and cash equivalents at September 30, 2024, of which approximately 18% was held inside the United States and the remainder held internationally.

Current wording

◦Cash flows from operating activities and existing cash resources: In addition to cash flows from operating activities, we also had $346.9 million of cash and cash equivalents at March 31, 2025, of which approximately 16% was held inside the United States and the remainder held internationally.

Previous wording

◦Our 2021 Credit Facility provides a $750.0 million committed revolving credit facility and commitments under the 2021 Credit Facility may be increased (subject to certain conditions) to an aggregate amount not to exceed $1.25 billion. Annual commitment fees to support availability under the 2021 Credit Facility are not material. Although not the principal source of liquidity, we believe our 2021 Credit Facility is capable of providing significant financing flexibility at reasonable rates of interest and is an attractive alternative source of funding in the event that commercial paper markets experience disruption. However, an increase in usage of the 2021 Credit Facility related to growth or a significant deterioration in the results of our operations or cash flows could cause our borrowing costs to increase and/or our ability to borrow could be restricted. We have not entered into any guarantees that could give rise to material unexpected cash requirements. The full $750.0 million of borrowing capacity under the 2021 Credit Facility was available to the Company at September 30, 2024.

Current wording

◦Our Revolving Credit Agreement provides a $1.0 billion committed revolving credit facility and commitments under the Revolving Credit Agreement may be increased (subject to certain conditions) to an aggregate amount not to exceed $1.5 billion. Annual commitment fees to support availability under the Revolving Credit Agreement are not material. Although not the principal source of liquidity, we believe our Revolving Credit Agreement is capable of providing significant financing flexibility at reasonable rates of interest and is an attractive alternative source of funding in the event that commercial paper markets experience disruption. However, an increase in usage of the Revolving Credit Agreement related to growth or a significant deterioration in the results of our operations or cash flows could cause our borrowing costs to increase and/or our ability to borrow could be restricted. We have not entered into any guarantees that could give rise to material unexpected cash requirements. The full $1.0 billion of borrowing capacity under the Revolving Credit Agreement was available to the Company at March 31, 2025.

Previous wording

A summary of our critical accounting estimates is included in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2023. We are required to make estimates and judgments in the preparation of our financial statements that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosures. We continually review these estimates and their underlying assumptions to ensure they are appropriate for the circumstances. Changes in the estimates and assumptions we use could have a material impact on our financial results. During the nine months ended September 30, 2024, there were no material changes in our estimates and critical accounting policies.

Current wording

A summary of our critical accounting estimates is included in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2024. We are required to make estimates and judgments in the preparation of our financial statements that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosures. We continually review these estimates and their underlying assumptions to ensure they are appropriate for the circumstances. Changes in the estimates and assumptions we use could have a material impact on our financial results. During the three months ended March 31, 2025, there were no material changes in our estimates and critical accounting policies.