ESAB Corp

Previous wording

All statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the Securities and Exchange Commission (the “SEC”). Statements that could be deemed to be forward-looking statements, include statements regarding: the impact of the wars in Ukraine and the Middle East and the resulting escalating geopolitical tensions on our business; projections of revenue, profit margins, expenses, tax provisions and tax rates, earnings or losses from operations, impact of foreign exchange rates, cash flows, pension and benefit obligations and funding requirements, synergies or other financial items; plans, strategies and objectives of our management for future operations, including statements relating to potential acquisitions, compensation plans or purchase commitments; developments, performance or industry or market rankings relating to products or services; future economic conditions or performance, including the impact of inflationary pressures, foreign exchange fluctuations and commodity prices; the outcome of outstanding claims or legal proceedings, including asbestos-related liabilities and insurance coverage litigation; potential gains and recoveries of costs; assumptions underlying any of the foregoing; and any other statement that addresses activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements may be, but are not always, characterized by terminology such as “believe,” “anticipate,” “should,” “would,” “could,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “targets,” “aims,” “seeks,” “sees,” and similar expressions. These statements are based on assumptions and assessments made by our management as of the filing date of this Form 10-Q in light of their experience and perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties and actual results or outcomes, or the timing of results or outcomes, could differ materially due to numerous factors, including but not limited to the following:

Current wording

All statements contained in this Form 10-Q that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the Securities and Exchange Commission (the “SEC”). Statements that could be deemed to be forward-looking statements, include statements regarding: the impact of the wars in Ukraine and the Middle East and the resulting escalating geopolitical tensions on our business; projections of revenue, profit margins, expenses, tax provisions and tax rates, earnings or losses from operations, impact of foreign exchange rates, cash flows, pension and benefit obligations and funding requirements, synergies or other financial items; plans, strategies and objectives of our management for future operations, including statements relating to potential acquisitions, compensation plans or purchase commitments; developments, performance, industry or market rankings relating to products or services; future economic conditions or performance, including the impact of inflationary pressures, foreign exchange fluctuations and commodity prices; the outcome of outstanding claims or legal proceedings, including asbestos-related liabilities and insurance coverage litigation; potential gains and recoveries of costs; assumptions underlying any of the foregoing; and any other statement that addresses activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future. Forward-looking statements may be, but are not always, characterized by terminology such as “believe,” “anticipate,” “should,” “would,” “could,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “targets,” “aims,” “seeks,” “sees” or similar expressions. These statements are based on assumptions and assessments made by our management as of the filing date of this Form 10-Q in light of their experience and perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties and actual results or outcomes, or the timing of results or outcomes, could differ materially due to numerous factors, including but not limited to the following:

Previous wording

Integral to our operations is EBX, our business management system. EBX is our culture and includes our values, a comprehensive set of tools, and repeatable, teachable processes that we use to drive continuous improvement and create superior value for our customers, stockholders and associates. We believe that our management team’s access to, and experience in, the application of the EBX methodology is one of our primary competitive strengths.

Current wording

Integral to our operations is EBX. EBX is our culture and includes our values, a comprehensive set of tools and repeatable, teachable processes that we use to drive continuous improvement and create superior value for our customers, stockholders and associates. We believe that our management team’s access to, and experience in, the application of the EBX methodology is one of our primary competitive strengths.

Previous wording

We believe that we are well positioned to grow our businesses organically over the long term by enhancing our product offerings and expanding our customer base. We believe our business mix is well balanced between sales in emerging and developed markets, and equipment and consumables. We intend to continue to utilize our strong global presence and worldwide network of salespeople and distributors to capitalize on growth opportunities by selling regionally-developed and/or marketed products and solutions throughout our served markets. We believe our geographic and end market diversity helps mitigate the effects from cyclical industrial market exposures. Given this balance, management does not use indices other than general economic trends and business initiatives to predict the overall outlook for the Company. Instead, our individual businesses monitor key competitors and customers, including to the extent possible their sales, to gauge relative performance and outlook for the future.

Current wording

We believe that we are well positioned to grow our businesses organically over the long term by enhancing our product offerings and expanding our customer base. We believe our business mix is well balanced between sales in high growth and developed markets, and equipment and consumables. We believe our geographic and end market diversity helps mitigate the effects from cyclical industrial market exposures. Given this balance, management does not use indices other than general economic trends and business initiatives to predict the overall outlook for the Company. Instead, our individual businesses monitor key competitors and customers, including to the extent possible their sales, to gauge relative performance and outlook for the future.

Previous wording

We expect strategic acquisitions to contribute to our growth. We believe that the extensive experience of our leadership team in acquiring and effectively integrating acquisition targets should enable us to capitalize on future opportunities. We believe that the recent acquisitions of Linde Industries Private Limited on July 2, 2024, Sager S.A. on February 26, 2024 and Therapy Equipment Limited (“Therapy Equipment”) on January 11, 2023 as well as the April 30, 2024 agreement to acquire SUMIG Soluções para Solda e Corte Ltda are aligned with this strategic direction. Refer to Note 3, “Acquisitions” and Note 16, “Subsequent Events” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.

Current wording

We expect strategic acquisitions to contribute to our growth. We believe that our extensive experience of acquiring and effectively integrating acquisition targets should enable us to capitalize on future opportunities. We believe that the recent acquisitions of Linde Industries Private Limited (“Linde Industries”) on July 2, 2024, Sager S.A. on February 26, 2024 and Therapy Equipment Limited (“Therapy Equipment”) on January 11, 2023 as well as the April 30, 2024 agreement to acquire SUMIG Soluções para Solda e Corte Ltda are aligned with this strategic direction. Refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q for additional information.

Previous wording

The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the three and six months ended June 28, 2024 and June 30, 2023.

Current wording

The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the three and nine months ended September 27, 2024 and September 29, 2023.

Previous wording

The comparability of our operating results for the three and six months ended June 28, 2024 and June 30, 2023 is affected by the following significant factors:

Current wording

The comparability of our operating results for the three and nine months ended September 27, 2024 and September 29, 2023 is affected by the following significant factors:

Previous wording

We complement our organic growth with acquisitions and other investments. Acquisitions can significantly affect our reported results, and we report the change in our Net sales between periods both from existing and acquired businesses. The change in Net sales due to acquisitions for the periods presented in this filing represents the incremental sales as a result of acquisitions.

Current wording

We complement our organic growth with acquisitions and other investments. Acquisitions can affect our reported results, and we report the change in our Net sales between periods both from existing and acquired businesses. The change in Net sales due to acquisitions for the periods presented in this filing represents the incremental sales as a result of acquisitions.

Previous wording

On February 26, 2024, the Company completed the acquisition of Sager S.A., a welding repair and maintenance product and service leader in South America. For additional information on this acquisition, refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q.

Current wording

On July 2, 2024, the Company completed the acquisition of Linde Industries, a leading welding company in Bangladesh. On February 26, 2024, the Company completed the acquisition of Sager S.A., a welding repair and maintenance product and service leader in South America. During the first quarter of 2023, the Company completed the acquisition of Therapy Equipment, a regional leader in oxygen regulators. For additional information on these acquisitions, refer to Note 3, “Acquisitions” in the accompanying Notes contained elsewhere in this Form 10-Q.

Previous wording

A significant portion of our Net sales,77% and 78%, for the three and six months ended June 28, 2024, respectively, are outside the United States, with the majority of those sales denominated in currencies other than the U.S. Dollar. Because much of our manufacturing and employee costs are outside the United States, a significant portion of our costs are also denominated in currencies other than the U.S. Dollar. Changes in foreign exchange rates can impact our results of operations and are quantified when significant.

Current wording

A significant portion of our Net sales,79% and 78%, for the three and nine months ended September 27, 2024, respectively, are outside the United States, with the majority of those sales denominated in currencies other than the U.S. Dollar. Because much of our manufacturing and employee costs are outside the United States, a significant portion of our costs are also denominated in currencies other than the U.S. Dollar. Changes in foreign exchange rates can impact our results of operations and are quantified when significant.

Previous wording

For the three months ended June 28, 2024 compared to the three months ended June 30, 2023, fluctuations in foreign currencies reduced Net sales by 3.4% and Gross profit by 3.6% and Selling, general and administrative expenses by 1.4%.

Current wording

For the three months ended September 27, 2024 compared to the three months ended September 29, 2023, fluctuations in foreign currencies reduced Net sales by 3.1% and Gross profit by 3.6% and Selling, general and administrative expenses by 1.6%.

Previous wording

For the six months ended June 28, 2024 compared to thesix months ended June 30, 2023, fluctuations in foreign currencies reduced Net sales by 2.6% and Gross profit by 2.7% and Selling, general and administrative expenses by 0.7%.

Current wording

For the nine months ended September 27, 2024 compared to thenine months ended September 29, 2023, fluctuations in foreign currencies reduced Net sales by 2.7% and Gross profit by 3.0% and Selling, general and administrative expenses by 1.0%.

Previous wording

Adjusted EBITDA is a non-GAAP performance measure that we include in this Form 10-Q because it is a key metric used by our management to assess our operating performance. ESAB presents this non-GAAP financial measure including and excluding Russia due to economic and political volatility caused by the Russia and Ukraine conflict, which we believe results in enhanced investor interest in these alternative presentations. Adjusted EBITDA excludes from Net income from continuing operations the effect of Income tax expense, Interest expense and other, net, Pension settlement (loss), Restructuring and other related charges, acquisition-amortization and other related charges and depreciation and other amortization. We also present Adjusted EBITDA margin, which is subject to the same adjustments as Adjusted EBITDA. Further, we present these non-GAAP performance measures on a segment basis, where we exclude the impact of Restructuring and other related charges, acquisition-amortization and other related charges and depreciation and other amortization from operating income. We also present Core adjusted EBITDA and Core adjusted EBITDA margins, which are subject to the same adjustments as Adjusted EBITDA and Adjusted EBITDA margins, respectively, and which removes the impact of Russia for the three and six months ended June 28, 2024 and June 30, 2023. Adjusted EBITDA and Core adjusted EBITDA assist management in comparing our operating performance over time because certain items may obscure underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to unusual events or discrete restructuring plans and other initiatives that are fundamentally different from our ongoing productivity and core business. Management also believes that presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.

Current wording

Adjusted EBITDA is a non-GAAP performance measure that we include in this Form 10-Q because it is a key metric used by our management to assess our operating performance. ESAB presents this non-GAAP financial measure including and excluding Russia due to economic and political volatility caused by the Russia and Ukraine conflict, which we believe results in enhanced investor interest in these alternative presentations. Adjusted EBITDA excludes from Net income from continuing operations the effect of Income tax expense, Interest expense and other, net, Pension settlement loss, Restructuring and other related charges, acquisition-amortization and other related charges and depreciation and other amortization. We also present Adjusted EBITDA margin, which is subject to the same adjustments as Adjusted EBITDA. Further, we present these non-GAAP performance measures on a segment basis, where we exclude the impact of Restructuring and other related charges, acquisition-amortization and other related charges and depreciation and other amortization from operating income. We also present Core adjusted EBITDA and Core adjusted EBITDA margin, which are subject to the same adjustments as Adjusted EBITDA and Adjusted EBITDA margin, respectively, and which removes the impact of Russia for the three and nine months ended September 27, 2024 and September 29, 2023. Adjusted EBITDA and Core adjusted EBITDA assist management in comparing our operating performance over time because certain items may obscure underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to unusual events or discrete restructuring plans and other initiatives that are fundamentally different from our ongoing productivity and core business. Management also believes that presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.

Previous wording

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information calculated in accordance with U.S. GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable U.S. GAAP financial measures.

Current wording

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information calculated in accordance with the accounting principles generally accepted in the United States (“U.S. GAAP”). Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable U.S. GAAP financial measures.

Previous wording

The following tables set forth a reconciliation of Net income from continuing operations, the most directly comparable GAAP financial measure, to Adjusted EBITDA, Adjusted EBITDA margin, Core adjusted EBITDA and Core adjusted EBITDA margin by segment for the three and six months ended June 28, 2024 and June 30, 2023.

Current wording

The following tables set forth a reconciliation of Net income from continuing operations, the most directly comparable GAAP financial measure, to Adjusted EBITDA, Adjusted EBITDA margin, Core adjusted EBITDA and Core adjusted EBITDA margin by segment for the three and nine months ended September 27, 2024 and September 29, 2023.

Previous wording

(3)Includes transaction expenses, amortization of intangibles, fair value charges on acquired inventories and integration expenses.

Current wording

(3)Includes transaction expenses, amortization of acquired intangibles, fair value charges on acquired inventories and integration expenses.

Previous wording

(5)Net sales were$40.7 million and$74.4 million relating to Russia for thethree and six months ended June 28, 2024, respectively.

Current wording

(5)Net sales were$37.7 million and$112.0 million relating to Russia for thethree and nine months ended September 27, 2024, respectively.

Previous wording

(5)Net sales were $40.3 million and $77.5 million relating to Russia for the three and six months ended June 30, 2023, respectively.

Current wording

(5)Net sales were $36.9 million and $114.4 million relating to Russia for the three and nine months ended September 29, 2023, respectively.

Previous wording

Net sales decreased for the three and six months ended June 28, 2024 as compared with the three and six months ended June 30, 2023. The following table presents the components of changes in our Net sales.

Current wording

Net sales decreased for the three and nine months ended September 27, 2024, compared to the prior year period. The following table presents the components of changes in our Net sales.

Previous wording

Net sales from existing businesses increased $8.4 million during the three months ended June 28, 2024, compared to the prior year period, due to an increase in sales volumes and new product initiatives for a combined $6.9 million and customer pricing increases of $1.5 million. During the three months ended June 28, 2024, the increase in net sales from acquisitions was attributable to Sager S.A. The strengthening of the U.S. Dollar relative to other currencies caused a $24.4 million unfavorable currency translation impact during the three months ended June 28, 2024.

Current wording

Net sales from existing businesses increased $6.6 million during the three months ended September 27, 2024, compared to the prior year period, due to customer pricing increases of $8.7 million that was partially offset by a $2.1 million decrease in sales volumes. The increase in net sales from acquisitions was attributable to Sager S.A. and Linde Industries. The changes in foreign exchange rates caused a $20.9 million unfavorable currency translation impact.

Previous wording

Net sales from existing businesses increased $25.0 million during the six months ended June 28, 2024, compared to the prior year period, due to an increase in sales volumes of $16.7 million and customer pricing increases of $8.3 million. During the six months ended June 28, 2024, the increase in net sales from acquisitions was attributable to Therapy Equipment and Sager S.A. The strengthening of the U.S. Dollar relative to other currencies caused a $36.3 million unfavorable currency translation impact during the six months ended June 28, 2024.

Current wording

Net sales from existing businesses increased $31.6 million during the nine months ended September 27, 2024, compared to the prior year period, due to an increase in sales volumes of $14.6 million and customer pricing increases of $17.0 million. The increase in net sales from acquisitions was attributable to Therapy Equipment, Sager S.A. and Linde Industries. The changes in foreign exchange rates caused a $57.3 million unfavorable currency translation impact.

Previous wording

Sales excluding Russia (“Core Sales”) decreased for the three and six months ended June 28, 2024 as compared with the three and six months ended June 30, 2023. The following table presents the components of changes in our Core Sales.

Current wording

Sales excluding Russia (“Core Sales”) decreased for the three and nine months ended September 27, 2024, compared to the prior year period. The following table presents the components of changes in our Core Sales.

Previous wording

(1)Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume.

Current wording

(2)Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume.

Previous wording

(2)Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business.

Current wording

(3)Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business.

Previous wording

(3)Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates.

Current wording

(4)Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates.

Previous wording

(4)Net sales relating to Russia were $40.7 million and $74.4 million for the three and six months ended June 28, 2024, respectively, and $40.3 million and $77.5 million for the three and six months ended June 30, 2023, respectively.

Current wording

(5)Net sales relating to Russia were $37.7 million and $112.0 million for the three and nine months ended September 27, 2024, respectively, and $36.9 million and $114.4 million for the three and nine months ended September 29, 2023, respectively.

Previous wording

Core Sales from existing businesses increased $3.9 million during the three months ended June 28, 2024, compared to the prior year period primarily due to a $3.3 million increase in sales volume and customer pricing increases of $0.6 million during the three months ended June 28, 2024. During the three months ended June 28, 2024, the increase in net sales from acquisitions was attributable to Sager S.A. The changes in foreign exchange rates caused a $20.4 million unfavorable currency translation impact during the three months ended June 28, 2024.

Current wording

Core Sales from existing businesses increased $8.0 million during the three months ended September 27, 2024 compared to the prior year period primarily due to customer pricing increases of $8.3 million partially offset by a $0.3 million decrease in sales volume. The $6.6 million increase in net sales from acquisitions was attributable to Sager S.A. and Linde Industries. The changes in foreign exchange rates caused a $23.1 million unfavorable currency translation impact.

Previous wording

Core Sales from existing businesses increased $16.9 million during the six months ended June 28, 2024, compared to the prior year period primarily due to an increase in sales volume of $12.6 million and customer pricing increases of $4.3 million during the six months ended June 28, 2024. During the six months ended June 28, 2024, the increase in net sales from acquisitions was attributable to Therapy Equipment and Sager S.A. The changes in foreign exchange rates caused a $25.1 million unfavorable currency translation impact during the six months ended June 28, 2024.

Current wording

Core Sales from existing businesses increased $24.9 million during the nine months ended September 27, 2024 compared to the prior year period primarily due to an increase in sales volume of $12.4 million and customer pricing increases of $12.5 million. The increase in net sales from acquisitions was attributable to Therapy Equipment, Sager S.A. and Linde Industries. The changes in foreign exchange rates caused a $48.3 million unfavorable currency translation impact.

Previous wording

Gross profit increased $6.4 million in the second quarter of 2024, which resulted in gross profit margin expanding 160 basis points to 38.2% compared with the prior year period. This increase was primarily attributable to lower overall material costs and favorable product mix partially offset by unfavorable currency translation.

Current wording

Gross profit increased $4.1 million in the third quarter of 2024, with gross profit margin expanding 100 basis points compared with the prior year period. This increase was primarily attributable to customer pricing, lower material costs and favorable product mix partially offset by unfavorable currency translation.

Previous wording

The effective tax rate of 17.3% for the quarter ended June 28, 2024 differed from the effective tax rate of 23.4% for the same period ended June 30, 2023 due to a favorable ruling in a tax case in a foreign jurisdiction in 2024.

Current wording

The effective tax rate of 20.3% for the quarter ended September 27, 2024 differed from the effective tax rate of 24.6% for the same period ended September 29, 2023 due to an agreement with a tax authority on the treatment of subsidy income in a foreign jurisdiction in 2024.

Previous wording

Net income from continuing operations increased $16.7 million in the second quarter of 2024, compared with the prior year period primarily due to the aforementioned factors. Net income margin from continuing operations increased by 250 basis points due to the aforementioned factors.

Current wording

Net income from continuing operations increased $10.2 million in the third quarter of 2024 compared with the prior year period primarily due to the aforementioned factors as well as lower interest expense. Net income margin from continuing operations increased by 170 basis points due to the aforementioned factors.

Previous wording

In the second quarter of 2024, Adjusted EBITDA increased $8.9 million and Adjusted EBITDA margin increased by 160 basis points compared to the same period in 2023 benefiting from higher Gross profit and lower Selling, general and administrative expense. Core adjusted EBITDA increased $7.5 million, and Core adjusted EBITDA margins expanded by 150 basis points compared to the same period in 2023.

Current wording

In the third quarter of 2024, Adjusted EBITDA increased $4.9 million and Adjusted EBITDA margin increased by 90 basis points compared to the same period in 2023 benefiting from higher Gross profit. Core adjusted EBITDA increased $7.0 million, and Core adjusted EBITDA margin expanded by 130 basis points compared to the same period in 2023.

Previous wording

Gross profit increased $14.0 million in the six months ended June 28, 2024, which resulted in the gross profit margin expanding 120 basis points to 37.6% compared with the prior year period. This increase was primarily attributable to benefits from price, lower overall material costs and favorable product mix, partially offset by unfavorable currency translation.

Current wording

Gross profit increased $18.1 million in the nine months ended September 27, 2024, with gross profit margin expanding 110 basis points compared with the prior year period. This increase was primarily attributable to benefits from customer pricing and lower material costs partially offset by unfavorable currency translation.

Previous wording

Selling, general and administrative expense decreased $8.8 million in the six months ended June 28, 2024, compared to the prior year period. This decrease was primarily driven by savings from restructuring initiatives and currency translation.

Current wording

Selling, general and administrative expense decreased $8.3 million in the nine months ended September 27, 2024, compared to the prior year period. This decrease was primarily driven by savings from restructuring initiatives and currency translation.

Previous wording

The effective tax rate of 19.7% for the six months ended June 28, 2024 differed from the effective tax rate of 36.0% for the same period ending June 30, 2023 due to discrete tax adjustments in 2023 for dividend withholding taxes and an increase in unrecognized tax benefits due to an adverse court ruling in a tax case in a foreign jurisdiction and a discrete tax adjustment in 2024 for a favorable final ruling in a tax case in a foreign jurisdiction.

Current wording

The effective tax rate of 19.9% for the nine months ended September 27, 2024 differed from the effective tax rate of 32.2% for the same period ending September 29, 2023 due to discrete tax adjustments in 2023 for dividend withholding taxes and an increase in unrecognized tax benefits due to an adverse court ruling in a tax case in a foreign jurisdiction and discrete tax adjustments in 2024 for a favorable final ruling in a tax case in a foreign jurisdiction and an agreement with a taxing authority on the treatment of subsidy income in a foreign jurisdiction in 2024.

Previous wording

Net income from continuing operations increased $45.4 million in the six months ended June 28, 2024, compared with the prior year period primarily due to lower restructuring charges, currency translation and tax expense partially offset by a pension settlement loss. Net income margin from continuing operations increased by 330 basis points due to the aforementioned factors.

Current wording

Net income from continuing operations increased $55.7 million in the nine months ended September 27, 2024 compared with the prior year period primarily due to the aforementioned factors as well as lower interest and income tax expenses. Net income margin from continuing operations increased by 270 basis points due to the aforementioned factors.

Previous wording

In the six months ended June 28, 2024, Adjusted EBITDA increased $20.0 million and Adjusted EBITDA margin increased by 150 basis points compared to the same period in 2023 benefiting from higher Gross profit and lower Selling, general and administrative expense. In the six months ended June 28, 2024, Core adjusted EBITDA increased by $18.0 million, and Core adjusted EBITDA margins expanded by 150 basis points.

Current wording

In the nine months ended September 27, 2024, Adjusted EBITDA increased $24.9 million and Adjusted EBITDA margin increased by 130 basis points compared to the same period in 2023 benefiting from higher Gross profit and lower Selling, general and administrative expense. In the nine months ended September 27, 2024, Core adjusted EBITDA increased by $25.2 million and Core adjusted EBITDA margin expanded by 140 basis points.

Previous wording

Net sales in our Americas segment increased $4.0 million in the six months ended June 28, 2024 compared with the prior year period. Net sales from existing business increased $21.4 million, and was partially offset by $21.0 million in unfavorable currency translation. The increase in Net sales from existing business was primarily due to inflation-related pricing increases partially offset by a decrease in sales volumes. The Sager S.A. acquisition contributed to $3.6 million of the overall sales increase. Gross profit increased $13.0 million to $233.9 million due to price increases, benefits from a product line simplification initiative, and the Sager S.A. acquisition, partially offset by an unfavorable currency impact. Gross profit margin increased 190 basis points to 38.6% primarily due to price increases, benefits from a product line simplification initiative, and the accretive impact of the Sager S.A. acquisition, partially offset by the impacts of inflation. Selling, general and administrative expense remained relatively consistent year over year. Adjusted EBITDA increased $11.1 million to $118.8 million and margins expanded 170 basis points to 19.6% primarily because of the aforementioned factors.

Current wording

Net sales in our Americas segment decreased $13.0 million in the nine months ended September 27, 2024 compared with the prior year period. Net sales from existing business increased $27.6 million, which was more than offset by $47.0 million in unfavorable currency translation. The increase in Net sales from existing business was primarily due to customer pricing increases, partially offset by a decrease in sales volumes. The Sager S.A. acquisition contributed to $6.4 million of the overall sales increase. Gross profit increased $11.4 million and Gross profit margin increased 180 basis points due to price increases, benefits from EBX driven business improvements and the Sager S.A. acquisition, partially offset by an unfavorable currency impact. Selling, general and administrative expense decreased by $5.6 million primarily due to savings from restructuring initiatives and currency translation. Adjusted EBITDA increased $13.3 million and Adjusted EBITDA margin expanded 170 basis points primarily because of the aforementioned factors.

Previous wording

Net sales decreased for our EMEA & APAC segment by $12.9 million in the second quarter of 2024, compared with the prior year period. This decrease was due to a $4.1 million decrease in Net sales from existing business and a $8.8 million unfavorable currency translation. The decrease in Net sales from existing business was primarily due to a decrease in customer pricing and unfavorable currency exchange impact. Gross profit decreased $1.4 million in the second quarter of 2024 compared with the prior year period primarily due to lower pricing and an unfavorable currency impact partially offset by lower overall material costs and improved product mix. Gross profit margin expanded 80 basis points compared to the same period in 2023 primarily due to improved product mix and lower overall material costs. Selling, general and administrative expense decreased compared to the same period in 2023 mainly due to savings from restructuring initiatives. Core adjusted EBITDA increased to $69.3 million and the related Core adjusted EBITDA margins expanded 110 basis points to 19.5% primarily because of the aforementioned factors.

Current wording

Net sales increased for our EMEA & APAC segment by $9.3 million in the third quarter of 2024 compared with the prior year period. This increase was primarily due to an increase in Net sales from existing business of $0.4 million, a $3.8 million increase related to the acquisition of Linde Industries and a $5.1 million favorable currency translation. Gross profit increased $5.7 million in the third quarter of 2024 compared with the prior year period primarily due to improved product mix and lower material costs partially offset by lower pricing. Gross profit margin expanded 70 basis points compared to the same period in 2023 primarily due to improved product mix, lower material costs and EBX driven business improvements. Selling, general and administrative expense remained relatively consistent compared to the same period in 2023. Adjusted EBITDA increased $2.8 million and Adjusted EBITDA margin expanded 30 basis points and Core adjusted EBITDA increased to $65.5 million and the related Core adjusted EBITDA margin expanded 100 basis points primarily because of the aforementioned factors.

Previous wording

Net sales in our EMEA & APAC segment decreased $11.6 million in the six months ended June 28, 2024 compared with the prior year period. Net sales from existing business increased $3.6 million, and was partially offset by $15.3 million in unfavorable currency translation. The increase in Net sales from existing business was primarily due to an increase in sales volumes partially offset by decreases in customer pricing. The Therapy Equipment acquisition contributed to $0.1 million of the overall sales increase. Gross profit and Gross profit margin increased $0.9 million and 60 basis points, respectively, due to lower cost of materials and improved product mix partially offset by an unfavorable currency impact. Selling, general and administrative expense decreased $8.8 million primarily due to lower employee costs, savings from restructuring initiatives and favorable currency translation. Adjusted EBITDA increased to $151.3 million and margins expanded 140 basis points to 19.1% primarily because of the aforementioned factors. Adjusted Core EBITDA increased to $138.5 million and margins expanded 120 basis points to 19.3% primarily because of the aforementioned factors.

Current wording

Net sales in our EMEA & APAC segment decreased $2.4 million in the nine months ended September 27, 2024 compared with the prior year period. Net sales from existing business increased $4.0 million, with the Therapy Equipment and Linde Industries acquisitions contributing an additional increase of $3.9 million. These increases were offset by $10.3 million in unfavorable currency translation. The increase in Net sales from existing business was primarily due to an increase in sales volumes partially offset by decreases in customer pricing. Gross profit and Gross profit margin increased $6.7 million and 70 basis points, respectively, due to EBX driven business improvements, lower material costs and improved product mix partially offset by an unfavorable currency impact. Selling, general and administrative expense decreased $5.8 million primarily due to savings from restructuring initiatives. Adjusted EBITDA increased $11.7 million and Adjusted EBITDA margin expanded 110 basis points and Core adjusted EBITDA increased to $203.9 million and Core adjusted EBITDA margin expanded 110 basis points primarily because of the aforementioned factors.

Previous wording

We expect to finance our working capital requirements through cash flows from operating activities. We expect that our primary ongoing requirements for cash will be for working capital, funding of acquisitions, capital expenditures and restructuring related cash outflows, asbestos-related cash outflows, and debt service and required amortization of principal and, pending approval from the Board of Directors, payment of cash dividends.

Current wording

We expect to finance our working capital requirements through cash flows from operating activities. We expect that our primary ongoing requirements for cash will be for working capital, funding of acquisitions, capital expenditures and restructuring related cash outflows, asbestos-related cash outflows, debt service and required amortization of principal, stock repurchase and, pending approval from the Board of Directors, payment of cash dividends.