Fortive Corp
For the period ended Jun 28, 2024. Filed Jul 24, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 28, 2024 · Filed Jul 24, 2024
FTV$65.37-0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-29; filed 2024-04-24.
0001659166-24-000108
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-28; filed 2024-07-24.
0001659166-24-000148
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 181 previous paragraphs and 214 current paragraphs.
111 unchanged; 56 reworded; 43 added; 13 removed; 1 previous and 4 current paragraphs rearranged.
Tables are not compared: 11 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (43)
Current report
In January 2024, we realigned Invetech from the AHS segment to the PT segment (the “Segment Realignment”) based on our strategic decision to divest the equipment design and manufacturing businesses of Invetech, while retaining the motion solution businesses (the “Motion Solution Business”) that are more closely aligned with the PT segment than the AHS segment. Prior period segment amounts below have been recast to conform to the revised segment presentation. In June 2024, we divested and transferred ownership of Invetech, excluding the Motion Solution Business, to its management team (the “Invetech Divestiture”). As a result of the divestiture, in the three and six-month periods ended June 28, 2024, we recorded a net realized loss of $25.6 million, which is identified as “Loss from divestiture” in the Consolidated Condensed Statements of Earnings. The divested businesses accounted for less than 1.0% of total revenue and less than 1.0% of total assets for the fiscal year ended December 31, 2023. The Invetech Divestiture did not represent a strategic shift with a major effect on the Company’s operations and financial results, and therefore the divested businesses are not reported as discontinued operations.
Current report
During the three and six-month periods ended June 28, 2024 (the “quarter” or the “second quarter” and “year-to-date period,” respectively), our sales increased by 1.7% and 3.0%, respectively.
Current report
The year-over-year increase in sales in the second quarter was driven by a 2.7% increase from acquisitions, net of divestitures partially offset by a 1.0% decrease due to unfavorable currency translation. Core revenue growth was essentially flat in the second quarter, where favorable pricing of 2.6% and volume gains in IOS and AHS were offset by volume declines in PT.
Current report
Geographically, in the year-to-date period, year-over-year sales from existing businesses in developed markets increased slightly, driven by low single-digit growth in North America while Western Europe and Japan were essentially flat. Sales from existing businesses in high growth markets increased year-over-year in the year-to-date period by low single-digits, driven by high-teens growth in Latin America, partially offset by a mid-single-digit decline in China.
Current report
•The year-over-year effect of amortization from existing businesses, and impairment of intangible assets incurred in 2023 — favorable 25 basis points
Current report
•The year-over-year net effect of acquisition and divestiture-related transaction costs incurred in the second quarter of 2024 — unfavorable 15 basis points
Current report
•The year-over-year net effect of acquired and divested businesses, including amortization, and acquisition-related fair value adjustments — unfavorable 115 basis points
Current report
Operating profit margin was 19.6% for the year-to-date period ended June 28, 2024, an increase of 180 basis points as compared to 17.8% in the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Current report
•Year-over-year fluctuations were consistent with those in the second quarter. Namely price from existing businesses, volume gains in IOS and AHS, and gains from productivity measures, partially offset by volume decline in certain businesses and end markets within our PT segment, higher employee compensation, customer acquisition and marketing costs, as well as unfavorable foreign exchange rates — favorable 85 basis points
Current report
•The year-over-year effect of amortization from existing businesses, and impairment of intangible assets incurred in 2023 — favorable 25 basis points
Current report
•The year-over-year net effect of acquisition and divestiture-related transaction costs incurred in the year-to-date period — unfavorable 95 basis points
Current report
•The year-over-year net effect of acquired and divested businesses, including amortization and acquisition-related fair value adjustments — unfavorable 135 basis points
Current report
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 95 basis points
Current report
Geographically, on a year-to-date basis, sales from existing businesses in developed markets increased by low single-digits, driven by low single-digit growth in North America and mid-single-digit growth in Western Europe. Sales from existing businesses in high growth markets increased year-over-year in the year-to-date period by mid-single-digits, driven by mid-single-digit growth in Asia, where China contributed a low single-digit growth, and mid-teens growth in Latin America.
Current report
Operating profit margin increased 80 basis points during the second quarter as compared to the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Current report
•The year-over-year effect of amortization from existing businesses, and impairment of intangible assets incurred in 2023 — favorable 65 basis points
Current report
•The year-over-year net effect of acquisition-related transaction costs incurred in the second quarter of 2024 — unfavorable 25 basis points
Current report
Operating profit margin increased 210 basis points during the year-to-date period, as compared to the comparable period of 2023. Year-over-year changes in operating profit margin comparisons were comprised of the following:
Current report
•Year-over-year increases in price and sales volume from existing businesses and gains from productivity measures, partially offset by higher employee compensation and customer acquisition and marketing costs, as well as unfavorable changes in foreign currency exchange rates — favorable 85 basis points
Current report
•The year-over-year effect of amortization from existing businesses, and impairment of intangible assets incurred in 2023 — favorable 50 basis points
Current report
•The year-over-year net effect of acquisition-related transaction costs incurred in the year-to-date period — unfavorable 15 basis points
Current report
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 125 basis points
Current report
Geographically, on a year-to-date basis, sales from existing businesses in developed markets decreased by mid-single-digits, driven by a low single-digit decline in North America, a high single-digit decline in Western Europe, and a low double-digit decline in Japan. Sales from existing businesses in high growth markets decreased year-over-year in the year-to-date period by mid-single-digits, driven by low double-digits decline in China.
Current report
•Year-over-year increase in price from existing businesses and gains from productivity measures, offset by net volume reductions in the segment and unfavorable changes in foreign currency exchange rates — unfavorable 100 basis points
Current report
•The year-over-year effect of amortization from existing businesses — unfavorable 10 basis points
Current report
•The year-over-year net effect of acquired and divested businesses, including amortization, and acquisition-related fair value adjustments — unfavorable 270 basis points
Current report
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 40 basis points
Current report
Operating profit margin increased 20 basis points during the year-to-date period as compared to the comparable period of 2023. Year-over-year changes in operating profit margins were comprised of the following:
Current report
•Year-over-year increase in price from existing businesses and gains from productivity measures, offset by net volume reduction in the segment, higher employee compensation costs, and unfavorable changes in foreign currency exchange rates — unfavorable 15 basis points
Current report
•The year-over-year effect of amortization from existing businesses — flat
Current report
•The year-over-year net effect of acquisition and divestiture-related transaction costs incurred in the year-to-date period primarily related to the EA acquisition — unfavorable 250 basis points
Current report
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 50 basis points
Current report
Geographically, core revenue in developed markets increased low single-digits in the second quarter, driven by a low single-digit growth in North America and a low double-digit growth in Western Europe. In high growth markets, core revenue increased by low double-digits in the second quarter, driven by mid-thirties growth in Latin America, while China was essentially flat.
Current report
Operating profit margin increased 430 basis points during the second quarter, as compared to the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Current report
•Year-over-year increases in price and volume from existing businesses and gains from productivity measures, partially offset by higher employee compensation costs — favorable 260 basis points
Current report
•The year-over-year effect of amortization from existing businesses — favorable 50 basis points
Current report
Operating profit margin increased 410 basis points during the year-to-date period as compared to the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Current report
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 115 basis points
Current report
Loss from divestiture
Current report
During the second quarter and year-to-date period, we recognized a net realized loss of $25.6 million related to the Invetech Divestiture. For further discussion of this transaction, refer to Note 1 to the consolidated condensed financial statements.
Showing the first 40 of 43 passages. Open the source sections for the rest.
Removed paragraphs (13)
Previous report
In January 2024, we realigned Invetech from the AHS segment to the PT segment, as we explored strategic alternatives for certain products and services of Invetech (the “Segment Realignment”). In March 2024, we entered into a non-binding memorandum of understanding with the management of Invetech, pursuant to which we will transfer ownership of certain product lines of Invetech to its current management team. The products and operations of Invetech that we will retain following such transfer of ownership are more closely aligned with the PT segment than the AHS segment. Prior period segment amounts below have been recast to conform to the revised segment presentation.
Previous report
•The year-over-year effect of amortization from existing businesses — favorable 30 basis points
Previous report
•The year-over-year net effect of acquisition-related transaction costs incurred in the first quarter of 2024 — unfavorable 180 basis points
Previous report
•The year-over-year net effect of acquired and divested businesses, including amortization, and acquisition-related fair value adjustments — unfavorable 140 basis points
Previous report
Operating profit margin increased 360 basis points during the first quarter as compared to the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Previous report
•The year-over-year effect of amortization from existing businesses — favorable 35 basis points
Previous report
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 180 basis points
Previous report
•Year-over-year increase in price from existing businesses and gains from productivity measures, partially offset by volume reduction and higher employee compensation — favorable 10 basis points
Previous report
•The year-over-year effect of amortization from existing businesses — favorable 10 basis points
Previous report
Operating profit margin increased 380 basis points during the first quarter, as compared to the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Previous report
•Year-over-year increases in price from existing businesses, increased volume, and gains from productivity measures, partially offset by higher employee compensation and customer acquisition and marketing costs — favorable 200 basis points
Previous report
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 110 basis points
Previous report
During 2021, the Organisation for Economic Co-operation and Development (the “OECD”) announced an agreed framework for “Pillar Two” and released detailed model rules for a global minimum corporate tax rate of fifteen percent (15%) which requires multilateral agreement(s) and/or country-specific legislative action to be effective. A few jurisdictions have implemented legislation with effective dates spanning from 2024 through 2026. We will continue to monitor further legislation by individual countries and are currently evaluating the potential impact of Pillar Two to our business in future periods.
Reworded paragraphs (56)
Previous wording
Certain statements included or incorporated by reference in this quarterly report, in other documents we file with or furnish to the Securities and Exchange Commission (“SEC”), in our press releases, webcasts, conference calls, materials delivered to shareholders and other communications, are “forward-looking statements” within the meaning of the United States federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions, divestitures, strategic opportunities, securities offerings, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into, including the expected impact of trade and tariff policies; new or modified laws, regulations and accounting pronouncements; impact of climate-related events or transition activities; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; foreign currency exchange rates and fluctuations in those rates; impact of changes to tax laws; general economic and capital markets conditions, including impact of inflation or interest rate changes; impact of geopolitical events, including the impact of the Ukraine/Russia conflict, conflict in the Middle East, and other hostilities; the timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that we intend or believe will or may occur in the future. Terminology such as “believe,” “anticipate,” “should,” “could,” “intend,” “will,” “plan,” “expect,” “estimate,” “project,” “target,” “may,” “possible,” “potential,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words.
Current wording
Certain statements included or incorporated by reference in this quarterly report, in other documents we file with or furnish to the Securities and Exchange Commission (“SEC”), in our press releases, webcasts, conference calls, materials delivered to shareholders and other communications, are “forward-looking statements” within the meaning of the United States federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding: projections of revenue, expenses, profit, profit margins, tax rates, tax provisions, cash flows, pension and benefit obligations and funding requirements, our liquidity position or other financial measures; management’s plans and strategies for future operations, including statements relating to anticipated operating performance, cost reductions, restructuring activities, new product and service developments, competitive strengths or market position, acquisitions, divestitures, strategic opportunities, securities offerings, stock repurchases, dividends and executive compensation; growth, declines and other trends in markets we sell into, including the expected impact of trade and tariff policies; new or modified laws, regulations and accounting pronouncements; impact of climate-related events or transition activities; outstanding claims, legal proceedings, tax audits and assessments and other contingent liabilities; foreign currency exchange rates and fluctuations in those rates; impact of changes to tax laws; general economic and capital markets conditions, including expected impact of inflation or interest rate changes; impact of geopolitical events, including the anticipated impact of the Ukraine/Russia conflict, conflict in the Middle East, and other hostilities; the timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that we intend or believe will or may occur in the future. Terminology such as “believe,” “anticipate,” “should,” “could,” “intend,” “will,” “plan,” “expect,” “estimate,” “project,” “target,” “may,” “possible,” “potential,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words.
Previous wording
•Pandemics and epidemics, including any resurgence in the spread of COVID-19, and any corresponding constraints on supply chain, labor force, and the operations of our customers, suppliers, and vendors could have an adverse impact on our business and results of operations.
Current wording
•Future pandemics and epidemics, and any corresponding constraints on supply chain, labor force, and the operations of our customers, suppliers, and vendors could have an adverse impact on our business and results of operations.
Previous wording
•We use artificial intelligence in our business and our products, and challenges with properly managing its use could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations.
Current wording
•We use artificial intelligence in our business, and challenges with properly managing its use could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations.
Previous wording
Our PT segment helps solve tough technical challenges to speed breakthroughs in a wide range of applications, from food and beverage production and manufacturing to next-generation electric vehicles and clean energy, as our customers seek new test solutions to enable the electrification and connectivity of everything. Our expertise in materials, methods and measurements are reflected in our electrical test & measurement, sensing and material technologies, and cell therapy equipment design and manufacturing offered to a broad set of customers and vertical end markets, including industrial, power and energy, automotive, medical equipment, food and beverage, aerospace and defense, semiconductor, and other general industries. Customers for these products and services include design engineers for advanced electronic devices and equipment, process and quality engineers focused on improved process capability and productivity, facility maintenance managers driving increased uptime, and other customers for whom precise measurement, reliability, and compliance are critical in their applications.
Current wording
Our PT segment helps solve tough technical challenges to speed breakthroughs in a wide range of applications, from food and beverage production and manufacturing to next-generation electric vehicles and clean energy, as our customers seek new test solutions to enable the electrification and connectivity of everything. Our expertise in materials, methods and measurements are reflected in our electrical test & measurement and sensing and material technologies offered to a broad set of customers and vertical end markets, including industrial, power and energy, automotive, medical equipment, food and beverage, aerospace and defense, semiconductor, and other general industries. Customers for these products and services include design engineers for advanced electronic devices and equipment, process and quality engineers focused on improved process capability and productivity, facility maintenance managers driving increased uptime, and other customers for whom precise measurement, reliability, and compliance are critical in their applications.
Previous wording
On January 3, 2024, we acquired EA Elektro-Automatik Holding GmbH (“EA”), a leading supplier of high-power electronic test solutions for energy storage, mobility, hydrogen, and renewable energy applications. The acquisition of EA will bolster our innovative portfolio of products and services for engineers with complementary test and measurement solutions enabling the global energy transition. The total consideration paid was approximately $1.72 billion, net of acquired cash. We recorded approximately $1.2 billion of goodwill related to the EA acquisition, which is not tax deductible.
Current wording
On January 3, 2024, we acquired EA Elektro-Automatik Holding GmbH (“EA”), a leading supplier of high-power electronic test solutions for energy storage, mobility, hydrogen, and renewable energy applications. The acquisition of EA will bolster our innovative portfolio of products and services for engineers with complementary test and measurement solutions enabling the global energy transition. The total consideration paid was approximately $1.72 billion, net of acquired cash. We recorded approximately $1.17 billion of goodwill related to the EA acquisition, which is not tax deductible.
Previous wording
We initiated a discrete plan in the first quarter of 2023 that was completed during the fourth quarter of 2023. The nature of these activities were broadly consistent throughout our segments and consist primarily of targeted workforce reductions in response to overall macroeconomic and other external conditions. We incurred these costs to position ourselves to provide superior products and services to customers in a cost-efficient manner, while taking into consideration the impact of broad economic uncertainties. During the three-month period ended March 31, 2023, we incurred charges of $17.6 million. These charges are recorded within Cost of sales and Selling, general, and administrative expenses in the Consolidated Condensed Statements of Earnings. Accrued restructuring costs were $13 million and $26 million as of March 29, 2024 and December 31, 2023 and are recorded within Accrued expenses and other current liabilities in the Consolidated Condensed Balance Sheets.
Current wording
We initiated a discrete restructuring plan in the first quarter of 2023 that was completed during the fourth quarter of 2023. The nature of these activities were broadly consistent throughout our segments and consisted primarily of targeted workforce reductions in response to overall macroeconomic and other external conditions. We incurred these costs to position ourselves to provide superior products and services to customers in a cost-efficient manner, while taking into consideration the impact of broad economic uncertainties. During the three and six-month periods ended June 30, 2023, we incurred charges of $10.7 million and $28.3 million, respectively.
Previous wording
During the three-month period ended March 29, 2024 (the “quarter” or the “first quarter”), our sales increased by 4.4%, driven by a 2.5% increase in our core revenue, and a 2.5% increase from acquisitions, net of divestitures, partially offset by 0.6% decrease from unfavorable currency translation. Core revenue growth was comprised of favorable pricing of 2.3% and increased volume of 0.2%. The increase in volume from IOS and AHS were mostly offset by declines in PT.
Current wording
Year-over-year increases in the year-to-date period were driven by a 1.2% increase in our core revenue and a 2.6% increase from acquisitions, net of divestitures, partially offset by a decline of 0.8% due to unfavorable currency translation. The core revenue growth performance in the year-to-date period of 1.2% was comprised of favorable pricing of 2.4% and volume gains in IOS and AHS offset by volume declines in PT.
Previous wording
Geographically, in the first quarter, year-over-year core revenue in developed markets increased low single-digits, driven by low single-digit growth in North America and mid-single-digit growth in Western Europe. Core revenue in high growth markets increased mid-single-digit year-over-year in the first quarter, driven by low double-digit growth in Latin America and low single-digit growth in Asia, despite a low single-digit decline in China.
Current wording
Geographically, in the second quarter, year-over-year core revenue in developed markets was essentially flat, driven by slight growth in North America, a mid-single-digits growth in Japan, offset by a mid-single-digit decline in Western Europe. Core revenue in high growth markets was up slightly year-over-year in the second quarter, driven by low-twenties growth in Latin America, offset by a mid-single-digit decline in China.
Previous wording
We anticipate revenue growth to be between 2% and 3% for the second quarter of 2024, and approximately 4.5% and 6% for the full year. We anticipate core revenue growth to be between flat and 2% for the second quarter and approximately 2% and 4% for the full year.
Current wording
We anticipate revenue growth to be between 3% and 4.5% for the third quarter of 2024, and approximately 3% and 4% for the full year. We anticipate core revenue growth to be between 2% and 3.5% for the third quarter and approximately 2% and 3% for the full year.
Previous wording
We expect foreign exchange rates to remain volatile throughout the year which could adversely impact our financial results. Additionally, our financial outlook is subject to various assumptions and risks, including but not limited to, macroeconomic conditions in the United States, China and other critical regions, ongoing challenges with global logistics and supply chains, disruption in supply or transportation resulting from geopolitical developments, severe weather or other events, impact of inflationary dynamics on our expenses or our ability to realize price increases in our sales, interest rates, market conditions in key product segments, and elective surgery rates. We will continue to deploy FBS to actively manage production challenges, collaborate with customers and suppliers to minimize disruptions and utilize pricing and other countermeasures to offset the aforementioned dynamics. We continue to monitor these conditions which may continue to impact our business, as well as potential adverse global economic trends and sentiments, monetary and fiscal policies, international trade and relations between the U.S., China and other nations, and investment and taxation policy initiatives being considered in the United States and by the Organization for Economic Co-operation and Development (“OECD”), including the potential impact of the Pillar Two initiative.
Current wording
We expect foreign exchange rates to remain volatile throughout the year, which could continue to adversely impact our financial results. Additionally, our financial outlook is subject to various assumptions and risks, including but not limited to, macroeconomic conditions in the United States, China and other critical regions, ongoing geopolitical developments and events, the impact of inflationary dynamics on our expenses or our ability to realize price increases in our sales, interest rates, market conditions in key product segments, and elective surgery rates. We will continue to deploy FBS to actively manage these challenges, collaborate with customers and suppliers to minimize disruptions and utilize pricing and other countermeasures to offset the aforementioned dynamics. We continue to monitor these conditions which may continue to impact our business, as well as potential adverse global economic trends and sentiments, monetary and fiscal policies, international trade and relations between the U.S., China and other nations, and investment and taxation policy initiatives being considered in the United States and by the Organization for Economic Co-operation and Development (“OECD”), including the potential impact of the Pillar Two initiative.
Previous wording
The following table summarizes total aggregate year-over-year sales growth and the components thereof for the first quarter as compared to the comparable period of 2023:
Current wording
The following table summarizes total aggregate year-over-year sales growth and the components thereof for the second quarter as compared to the comparable period of 2023:
Previous wording
Operating profit margin was 19.8% for the first quarter, yielding an increase of 330 basis points as compared to 16.5% in the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Current wording
Operating profit margin was 19.4% for the second quarter, yielding an increase of 30 basis points as compared to 19.1% in the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Previous wording
•Year-over-year increase in price from existing businesses, a slight increase in overall demand despite a decline in certain businesses in PT, and gains from productivity measures, which were partially offset by higher employee compensation, customer acquisition and marketing costs — favorable 90 basis points
Current wording
•Year-over-year increase in price from existing businesses, volume gains in IOS and AHS, and gains from productivity measures, partially offset by a volume decline in certain businesses and end markets within our PT segment, higher employee compensation, customer acquisition and marketing costs, as well as unfavorable changes in foreign currency exchange rates — favorable 65 basis points
Previous wording
•The year-over-year effect of amortization from existing businesses — favorable 70 basis points
Current wording
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 70 basis points
Previous wording
•The year-over-year effect of the gain on sale of land and certain office buildings in the PT segment in the first quarter of 2024 — favorable 410 basis points
Current wording
•The year-over-year effect of the gain on sale of land and certain office buildings in the PT segment in the first quarter of 2024 — favorable 205 basis points
Previous wording
The sales results for the first quarter were driven primarily by growth in our existing businesses due to price increases and increased volume in our test and measurement instrumentation and gas detection products as well as software and service offerings in both EHS and facility and asset lifecycle applications.
Current wording
The sales results for both the second quarter and year-to-date period were driven primarily by growth in our existing businesses due to price increases and increased volume in our test and measurement instrumentation and gas detection products, as well as software and service offerings in both EHS and facility and asset lifecycle applications.
Previous wording
Geographically, core revenue in developed markets increased in the first quarter by low single-digits, driven by low single-digit growth in North America and high single-digit growth in Western Europe. Core revenue in high growth markets increased by high single-digits, driven by high single-digit growth in China and mid-teens growth in Latin America.
Current wording
Geographically, core revenue in developed markets increased in the second quarter by low single-digits, driven by a mid-single-digit growth in North America and a low single-digit growth in Western Europe. Core revenue in high growth markets was low single-digits, driven by mid-teens growth in Latin America, partially offset by a mid-single-digit decline in China.
Previous wording
Year-over-year price increases in our IOS segment contributed 2.9% to sales growth in the first quarter and is reflected as a component of the change in sales from existing businesses.
Current wording
Year-over-year price increases in our IOS segment contributed 2.4% and 2.6% to sales growth during the second quarter and year-to-date period, respectively, and is reflected as a component of the change in sales from existing businesses.
Previous wording
•Year-over-year increase in price and sales volumes from existing businesses and gains from productivity measures, partially offset by higher employee compensation and customer acquisition and marketing costs — favorable 180 basis points
Current wording
•Year-over-year increase in price and sales volumes from existing businesses, offset by higher employee compensation and customer acquisition and marketing costs, as well as unfavorable changes in foreign currency exchange rates — relatively flat
Previous wording
•The year-over-year net effect of acquired business, including amortization — unfavorable 35 basis points
Current wording
•The year-over-year net effect of acquired business, including amortization — unfavorable 30 basis points
Previous wording
Our PT segment helps solve tough technical challenges to speed breakthroughs in a wide range of applications, from food and beverage production and manufacturing to next-generation electric vehicles and clean energy, as our customers seek new test solutions to enable the electrification and connectivity of everything. Our expertise in materials, methods and measurements are reflected in our electrical test & measurement, sensing and material technologies, and cell therapy equipment design and manufacturing offered to a broad set of customers and vertical end markets, including industrial, power and energy, automotive, medical equipment, food and beverage, aerospace and defense, semiconductor, and other general industries.
Current wording
Our PT segment helps solve tough technical challenges to speed breakthroughs in a wide range of applications, from food and beverage production and manufacturing to next-generation electric vehicles and clean energy, as our customers seek new test solutions to enable the electrification and connectivity of everything. Our expertise in materials, methods and measurements are reflected in our electrical test & measurement and sensing and material technologies offered to a broad set of customers and vertical end markets, including industrial, power and energy, automotive, medical equipment, food and beverage, aerospace and defense, semiconductor, and other general industries.
Previous wording
The sales results for the first quarter were impacted by the overall price increases in the segment and volume increases in energetic materials which were offset by volume reductions in test and measurement and sensing technology products. The acquisition of EA, partially offset by product line divestments at Invetech, contributed 5.6% to revenue growth.
Current wording
The sales results for both the second quarter and year-to-date periods were impacted by price increases across the segment and volume increases in energetic materials, which were offset by volume reductions in test and measurement and sensing technology products. The acquisition of EA, partially offset by the Invetech Divestiture, contributed 6.0% and 5.8% to revenue growth during the second quarter and year-to-date period, respectively.
Previous wording
Geographically, core revenue in developed markets decreased slightly in the first quarter, with low single-digit growth in North America being offset by a slight decline in Western Europe and a mid-twenties decline in Japan. Core revenue in high growth markets decreased by low single-digits in the first quarter driven by a low double-digit decline in China, partially offset by high single-digit growth in Other Asia.
Current wording
Geographically, core revenue in developed markets decreased by mid-single-digits in the second quarter, driven by a mid-single-digit decline in North America, a mid-teens decline in Western Europe, and a mid-single-digit growth in Japan. Core revenue in high growth markets decreased by high single-digits in the second quarter, driven by a high single-digit decline in Asia where China decreased by high single-digits.
Previous wording
Year-over-year price increases in our PT segment contributed 1.3% to sales growth in the first quarter and is reflected as a component of the change in sales from existing businesses.
Current wording
Year-over-year price increases in our PT segment contributed 2.3% and 1.8% to sales growth for the second quarter and year-to-date period, respectively, and is reflected as a component of the change in sales from existing businesses.
Previous wording
Operating profit margin increased 390 basis points for the first quarter as compared to the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Current wording
Operating profit margin decreased 350 basis points for the second quarter as compared to the comparable period of 2023. Year-over-year changes in operating profit margin were comprised of the following:
Previous wording
•The year-over-year net effect of acquisition-related transaction costs, which were incurred in the first quarter of 2024 related to the EA acquisition — unfavorable 485 basis points
Current wording
•The year-over-year net effect of acquisition and divestiture-related transaction costs, which were incurred in the second quarter of 2024, primarily related to the EA acquisition — unfavorable 10 basis points
Previous wording
•The year-over-year net effect of acquired and divested business, including amortization, and acquisition-related fair value adjustments — unfavorable 335 basis points
Current wording
•The year-over-year net effect of acquired and divested businesses, including amortization, and acquisition-related fair value adjustments — unfavorable 335 basis points
Previous wording
•The year-over-year effect of the gain on sale of land and certain office buildings in the first quarter of 2024 — favorable 1,130 basis points
Current wording
•The year-over-year effect of the gain on sale of land and certain office buildings in the first quarter of 2024 — favorable 570 basis points
Previous wording
The sales results for the first quarter were driven by growth in our existing businesses due to price increases across the segment and volume increases, primarily with sterilization products
Current wording
The sales results for both the second quarter and year-to-date period were driven by growth in our existing businesses due to price increases across the segment and volume increases in our sterilization products.
Previous wording
Geographically, core revenue in developed markets increased mid-single-digits in the first quarter, driven by mid-single-digit growth in North America, low single-digit growth in Western Europe, and high single-digit growth in Japan. In high growth markets, core revenue increased by high single-digits in the first quarter, driven by low double-digit growth in China and mid-teens growth in Latin America.
Current wording
Geographically, on a year-to-date basis, sales from existing businesses in developed markets increased by mid-single-digits, driven by a low single-digit growth in North America, high single-digit growth in Western Europe, and high single-digit growth in Japan. Sales from existing businesses in high growth markets increased by low double-digits, driven by high twenties growth in Latin America and mid-single-digit growth in China.
Previous wording
Year-over-year price increases in our AHS segment contributed 2.8% to sales growth in the first quarter and is reflected as a component of the change in sales from existing businesses.
Current wording
Year-over-year price increases in our AHS segment contributed 3.5% and 3.2% to sales growth during the second quarter and year-to-date period, respectively, and is reflected as a component of the change in sales from existing businesses.
Previous wording
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 60 basis points
Current wording
•The year-over-year effect of amortization from existing businesses — favorable 60 basis points
Previous wording
The year-over-year increase in gross profit during the first quarter was due to year-over-year increases in price and volume from both existing and acquired businesses, productivity measures and FBS initiatives, partially offset by higher employee compensation costs.
Current wording
The year-over-year increase in gross profit during the second quarter and year-to-date period was due to contributions from our acquired businesses, price increases from existing businesses, increased volume with IOS and AHS, productivity measures and FBS initiatives. The volume decline in our PT segment, higher employee compensation costs, and unfavorable changes in foreign currency exchange rates partially offset the year-over-year increase.
Previous wording
The year-over-year increase in SG&A during the first quarter was due to higher intangible amortization and incremental operating costs and transaction expenses from our recent acquisitions, employee compensation costs, customer acquisition and marketing costs, partially offset by productivity measures.
Current wording
The year-over-year increase in SG&A during the second quarter and year-to-date period was due to higher intangible amortization, incremental operating costs and transaction expenses from our recent acquisitions, employee compensation costs, and customer acquisition and marketing costs, partially offset by productivity measures.
Previous wording
R&D, consisting principally of internal and contract engineering personnel costs, increased during the first quarter, as compared to the comparable period of 2023 due to the incremental costs from our recent acquisitions and ongoing investments in innovation.
Current wording
R&D, consisting principally of internal and contract engineering personnel costs, increased during the second quarter and year-to-date period, as compared to the comparable period of 2023 due to the incremental costs from our recent acquisitions and ongoing investments in innovation.
Previous wording
Net interest expense for the first quarter was $44 million as compared to $32 million in the comparable period in 2023. The year-over-year increase in net interest expense was due to higher overall debt balance and higher interest rates incurred on floating rate debt instruments. For discussion of our outstanding indebtedness, refer to Note 5 to the consolidated condensed financial statements.
Current wording
Net interest expense for the second quarter and year-to-date period was $38.7 million and $82.7 million as compared to $33.1 million and $65.2 million in the comparable periods in 2023. The year-over-year increase in net interest expense was due to higher overall debt balances and higher interest rates incurred on floating rate debt instruments. For discussion of our outstanding indebtedness, refer to Note 5 to the consolidated condensed financial statements.
Previous wording
Other non-operating expense for the first quarter was $24.2 million as compared to $2.5 million in the comparable period in 2023. The year-over-year increase was primarily due to a charitable contribution made in the first quarter of 2024. For further discussion of this transaction, refer to Note 1 to the consolidated condensed financial statements.
Current wording
Other non-operating expense for the second quarter and year-to-date period was $8.8 million and $33.0 million, respectively, as compared to $7.8 million and $10.3 million, respectively, in the comparable period in 2023. The year-over-year increase during the year-to-date period was primarily due to a charitable contribution made in the first quarter of 2024. For further discussion of this transaction, refer to Note 1 to the consolidated condensed financial statements.
Previous wording
Our effective tax rates for the three-month period ended March 29, 2024 were 11.4%, as compared to 15.7%, for the three-month period ended March 31, 2023. The decrease in the effective tax rate for the three-month period ended March 29, 2024 as compared to the three-month period ended March 31, 2023 was primarily related to cash repatriation, resulting in a discrete tax credit in the three-month period ended March 29, 2024
Current wording
Our effective tax rates for the three and six-month periods ended June 28, 2024 were 14.7% and 13.0%, respectively, as compared to 16.5% and 16.1%, respectively, for the three and six-month periods ended June 30, 2023. The decrease in the effective tax rate for the three-month period ended June 28, 2024 as compared to the three-month period ended June 30, 2023 was primarily related to change in valuation allowances, resulting in a benefit in the three-month period ended June 28, 2024. The decrease in the effective tax rate for the six-month period ended June 28, 2024 as compared to the six-month period ended June 30, 2023 was primarily related to cash repatriation, resulting in a discrete tax credit, and changes in valuation allowances in the six-month period ended June 28, 2024.
Previous wording
Our effective tax rates for the three-month period ended March 29, 2024, differ from the U.S. federal statutory rate of 21% due primarily to the impact of credits and deductions provided by law and changes in our uncertain tax position reserves.
Current wording
Our effective tax rates for the three and six-month periods ended June 28 2024, differ from the U.S. federal statutory rate of 21% due primarily to the impact of credits and deductions provided by law and changes in our uncertain tax position reserves.
Previous wording
Comprehensive income decreased by $56 million during the first quarter as compared to the comparable period in 2023 due primarily to unfavorable changes in foreign currency translation adjustments of $90 million, partially offset by an increase in net income.
Current wording
Comprehensive income decreased by $27 million during the second quarter as compared to the comparable period in 2023 due to a decrease in net income and unfavorable changes in foreign currency translation adjustments of $14 million.
Showing the first 40 of 56 pairs. Open the source sections for the rest.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
•The year-over-year effect of costs relating to the discrete restructuring plan initiated and completed in 2023 — favorable 70 basis points
Current report — wording carried from elsewhere
•The year-over-year net effect of acquired business, including amortization, and acquisition-related fair value adjustments — unfavorable 35 basis points
Current report — wording carried from elsewhere
•Year-over-year increases in price and volume from existing businesses and gains from productivity measures, partially offset by higher employee compensation and customer acquisition and marketing costs — favorable 235 basis points
Current report — wording carried from elsewhere
Comprehensive income decreased by $83 million during the year-to-date period as compared to the comparable period in 2023 due primarily to unfavorable changes in foreign currency translation adjustments of $104 million, offsetting the increase in net income.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
•The year-over-year net effect of acquisition-related transaction costs, which were incurred in the first quarter of 2023 — relatively flat